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- What Are Netting Escrows & How Does It Work?: The Best Guide - January 2, 2024
- The Secret About Prescriptive Easement: Top Guide 1 Must Know - December 4, 2023
- About Home Equity Loans In Texas And How Can One Obtain It - November 27, 2023
About Month To Month Lease
If you are a landlord planning to lease your rental property, you may have multiple options to lease your property.
Most rental lease agreements are for twelve or eighteen months, however, 6 months and 2 years lease agreements are also used by many landlords.
Another option that a landlord may have to lease the property is month to month rental agreement.
In this post, we will understand what is month to month lease is and how it works in detail.
What Is Month To Month Lease Agreement?
A month-to-month tenancy is a periodic tenancy created when the renter is allowed possession of the property without any expiration date and pays rent to the owner every month.
This type of rental agreement is most commonly executed in residential properties.
In case there is no written agreement, the tenancy would be considered to be a month-to-month lease.
Month-to-month rental agreement refers to a form of periodic tenancy in which the landlord leases property to the tenant for 30 days. The tenancy is created through an oral, written, or executed agreement.
How Does A Month-To-Month Lease Work?
Renting out properties is considered under real estate laws that involve leasing. In real estate legal terms, a lease is an agreement between the property owner, also referred to as the landlord, and the tenant who leases the property.
A lease agreement transfers the landlord’s entitlement of sole ownership and use of the property to the renter for an agreed-upon period.
As everyone who rents an apartment knows, the lease specifies the duration of the contract and the amount of rent that the tenant has agreed to pay.
Renters have access to the property and use it in the manner agreed in the rental agreement.
The landlord receives rent for a period specified in the agreement, and after the lease period is up their ownership rights are returned to the owner.
A month-to-month lease agreement usually lasts, as the name implies, for 30 days.
Unlike a long-term rental agreement, it usually involves an automatic renewal unless the tenant or landlord provides notice of withdrawal, according to the laws.
Most month-to-month lease agreements require thirty-day notice by either the owner or renter; however, this may vary based on local laws.
The Benefits And Drawbacks Of Month-To-Month Tenancy?
Though this type of tenancy is one of the simplest ways to rent out a property it has its benefits and drawbacks.
Benefits of Month To Month Tenancy:
- Keeping tenants in good shape: This type of tenancy allows property owners to keep tenants that control the property and pay rent on time.
- No penalty for breach of agreement: Termination of this type of lease is without penalty as the tenant or landlord has to break the contract at some point which lasts only for 30 days.
- Rent Price Updates: This type of tenancy allows landlords to update rent during the renewal period by agreeing to the tenant using things like ease and convenience.
- Flexible lease period: Rental agreement can operate without an end date allowing the renter to easily terminate the contract.
Drawback Of Month To Month Tenancy:
- Flexible end dates: Flexible end dates can benefit both tenants and landlords, but there may be some restrictions for landlords. Most landlords are looking for stable and long-term income from their rental properties.
- Less time to find new tenants: To find new and good tenants 30 days’ notice could fall short. Knowing the expiration date of the contract provides the owners with enough time to find an appropriate tenant.
Conclusion
This type of tenancy provides excellent flexibility to both tenants and the landlord. That said, there are many things to consider before getting into this type of tenancy.
The owner decides whether to consider long-term tenancy or month-to-month rental.
Check the market conditions before you rent your property, as it would help you to decide whether to go for a month-to-month tenancy or a long-term rental agreement.
