When you sell a rental property in California while tenants still live there, the lease does not break. It moves with the property to the new owner. That is the single most useful fact to understand. The lease travels, and the buyer prices the deal based on that fact. The rent roll is the document that shows them exactly what they are buying.
The rent roll answers the basic questions a buyer has. Who pays rent, how much, since when, and under what terms. Buyers ask for it first. If the roll has holes or mistakes, your credibility drops and the price can suffer. It is a simple document, but it must be clean.
Another common question is about the tenant estoppel certificate. This is a separate document that confirms the rent roll from the tenant side. Each tenant signs a statement saying yes, I pay this much, my lease ends on this date, and I have no side deals with the landlord. Collecting these certificates early is smart. If you wait until late in the sale process, a tenant might correct a fact that contradicts your rent roll. That slows the deal or kills it.
People also ask what happens to security deposits. They transfer to the new owner. They are not your income. You must account for them in writing at closing. The buyer gets the deposits, and the buyer becomes responsible for returning them when the tenant moves out. Your paperwork needs to show the exact amount held for each tenant.
Some sellers worry that a tenant can block the sale. A tenant cannot. The lease conveys with the property, and the buyer accepts the tenants as they are. An eviction or a vacancy is not needed to sell. The buyer looks at the cash flow, not the empty rooms.
If you are selling a rental in California, prepare the rent roll and the estoppel certificates before you list the property. Gaps in the roll cost you money. Late estoppels cause delays. Deposits need clear accounting. These are the common questions, and the answers are straightforward. Do the paperwork early, and the sale runs smoother.
More notes on this topic are at read about estoppels.