Most of my tenants are on month-to-month leases, and a few are on yearly leases. When one of my yearly lease tenants moves out prior to the lease being up, I have them continue to pay the rent until I find the next tenant, which usually doesn’t take long. For the penalty of breaking the lease, I keep their deposit.
Most people think that month-to-month leases pose yet another challenge in the already difficult job of landlording. They feel that tenants are more likely to move out if they have a monthly lease. But I haven’t found this to be the case. I have monthly payers who’ve been with me for three or four years. And seriously, with the economy the way it is, it makes sense to do monthly leases . . . people’s lives can change for the worse in an instant. They get laid off, lose their jobs, get transferred out of state, etc. So they appreciate being on a monthly lease instead of a long-term commitment.
And here’s the beauty — for us landlords — of the month-to-month lease. If you have a tenant who’s been nothing but trouble, or has been unreasonably demanding, or otherwise undesirable, you can take back your rental unit with 30 days’ written notice. Tell them you intend to do some renovations to the unit — whatever. But you can have them move with that 30 days’ notice. (Actually, you can even evict them for the above issues as long as there’s no discrimination or illegal retaliation involved on your part. I’ll cover that in another blog post.)
So don’t be afraid to go with a month-to-month lease. It can help your tenant, who may be willing to pay a bit more rent for this privilege, and it can also help you, if you decide the tenancy isn’t going the way you’d like!
Onward and upward . . .