Year Lease vs. Month to Month/?? (apartment, renter, month-to-month)

[john3232]

When new renters of mine move in they sign a 1-yr lease.

However, when the year is up I have them re-sign for a year if they agree. I`ve not been accepting month to month.

So, if they sign a year lease and break it they have to pay the $400 fee my property manager charges to find a new tenant. (The $400 charge is waved if my pm can place a new tenant right away.)

On the other hand if they sign a month to month lease they can leave anytime and avoid the potential $400 penalty assuming they give 30-days notice.

Of course, on a month to month I can also terminate the lease in 30-days.

I`d like to know what landlords feel are the pros and cons of a month to month as opposed when renewing tenants for another 1-year lease.

Thanks

[ElleTea]

Originally Posted by john3232

When new renters of mine move in they sign a 1-yr lease.

However, when the year is up I have them re-sign for a year if they agree. I`ve not been accepting month to month.

So, if they sign a year lease and break it they have to pay the $400 fee my property manager charges to find a new tenant. (The $400 charge is waved if my pm can place a new tenant right away.)

On the other hand if they sign a month to month lease they can leave anytime and avoid the potential $400 penalty assuming they give 30-days notice.

Of course, on a month to month I can also terminate the lease in 30-days.

I`d like to know what landlords feel are the pros and cons of a month to month as opposed when renewing tenants for another 1-year lease.

Thanks

I am not a landlord, I am a tenant, but here is my opinion.

I had a great apartment that started with a one year lease with the option to sign a new year, OR go month to month. The plan had been to go month to month for awhile once that year was up(3-6 more months? Maybe more) and decide what to do next. Well, about 2 months before my 1 year lease was up, the property sold to a new management company who did NOT do month to month, 1 year ONLY. So, I moved. I was not prepared to lock into another year, though I wasn't in a hurry to leave either. The month to month option removed forced me to move sooner.

Moved out, place sat empty for at least 2 months that I know of (maybe longer), meaning no rent income for the owners. Had I been allowed to do month to month, there would be no lost revenue for them. I am a great tenant. I pay rent on time, take great care of the places I live. It was their loss, IMO.

If I were a landlord I would allow month to month after the initial year, with a signed agreement like you stated above.

[john3232]

One plus about locking a tenant in for 12-month lease is you know when the agreement expires.

I prefer not having to look for a new renter Dec or Jan.

[ElleTea]

Originally Posted by john3232

One plus about locking a tenant in for 12-month lease is you know when the agreement expires.

I prefer not having to look for a new renter Dec or Jan.

My lease was up in December which is exactly why I wanted to go on month to month, to break that pattern of renewing that time of year

[Zippyman]

There's no real benefit to you (as the landlord) to sign a second yearly lease. Tenants can leave at any time whether or not there is a year left on the lease & you're still obligated to re-rent asap & minimize your "damages"..

a deadbeat tenant isn't going to worry about the lease & a great tenant shouldn't really be "punished" for trying to do the right thing. If you're a landlord, you're in the business of renting & re-renting your asset. A new tenant is a great opportunity to fluff the house & jack the rent to current market rate. Most (smaller) landlords (including myself) try not to mess with rent increases with a known/great tenant.

The other big benefit to a month-to-month tenancy is the ability to ditch a bad tenant quickly for no stated reason - like your "mold-o-phobe" tenant. Get rid of them & get a tenant who *wants* to be in your (awesome!) home.

The "off season" lease argument doesn't carry much weight with me. Yes, there are less houses for rent in the "off" months, to me - that's a huge benefit. My houses are nicer than the rest & tenants can't be as picky about layout, colors, or square footage if there are only one or two homes in the target neighborhood. Tenants can pick my squeaky-clean / updated home for top-dollar, or someone else's tired / cobbled home to "save" $50 or $100 per month. The tenants who will live in a dump to "save" money aren't the ones I want anyway.

[PinkElephant]

Jobs change, lifestyles change please do your tenants a favor and keep offering month to month. I stayed in the same place for years because I was happy there. I am in a lease and am trapped. You get happy tenants and you don't need a contract that is expensive to break you will all be happier.

We went for years without vacancies at my old place. Now, ppl are calling in favors from friends and family and getting a uhaul. Moving in with friends and family or even out of state.

[john3232]

Originally Posted by Zippyman

...Most (smaller) landlords (including myself) try not to mess with rent increases with a known/great tenant.

Agree.

Originally Posted by Zippyman

...The other big benefit to a month-to-month tenancy is the ability to ditch a bad tenant quickly for no stated reason - like your "mold-o-phobe" tenant. Get rid of them & get a tenant who *wants* to be in your (awesome!) home...

Which is a big reason why I want to go month to month.

If I want a tenant out I can do so fast. I`m not going to argue with anyone. Like you I make it a point to keep my properties clean and in good condition.

However, if a tenant suddenly begins to weird on me like say with the mold issue I mentioned awhile back then here`s your 30-day notice.