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July 31, 2018 |

The Pros and Cons of a Month-to-Month Lease

A Boston tenant lawyer can provide advice to both landlords and tenants on key issues inherent with lease agreements. One of the most important issues that may need to be addressed is the length of the lease term.  For residential tenants, it is very common to sign a one year lease, which would mean the tenant is obligated to stay and pay rent for a year and the landlord cannot evict the tenant without cause or raise rent during this one year period of time.

However, not every rental agreement involves a one year lease. There is also the option for a different term length, including a month-to-month lease. Month to month leases have some advantages and some disadvantages for both landlords and renters, and talking to a lawyer about whether to offer one to your tenants or sign one as a renter is advisable.

Month-to-Month Leases

One of the biggest benefits of a month-to-month lease for both landlords and tenants is increased flexibility. When tenants are sign a 12-month lease, they cannot just leave whenever they want to if they discover that they need to move. And, landlords can't just give 30 days notice to ask a tenant with a one-year lease to vacate the premises if the landlord gets a better offer from a different renter or otherwise decides a different tenant would be best. With a month-to-month lease, both parties have much more freedom to end the arrangement quickly.

For landlords, however, the fact that a tenant can just leave on short notice is a big downside. Month-to-month leases are likely to lead to more turnover, which can mean higher costs for advertising and cleaning the rental unit and a greater likelihood of having months without tenants. 

Typically, because of this big downside for landlords, landlords who allow month-to-month leases will charge tenants a higher rent. Tenants who want the flexibility of being able to move on short notice may decide that it is worth paying this premium, but the added cost can be substantial. Zillow indicates that in some markets such as Washington, D.C., the rent on a month-to-month lease is around 50 percent more on average than the rent on a 12-month lease. In other markets, the premium may be lower. In Manhattan, for example, Zillow indicates that a landlord may charge around 15 percent more to 20 percent more.

With a month-to-month lease, rent is also not fixed for more than the month that the lease is in effect, which means that landlords could decide to raise the rent on a tenant with 30 days notice and tenants would need to decide whether it is worth paying more or whether they want to vacate the premises instead.

If you are considering a month-to-month lease and want advice on whether this type of lease agreement is right for your situation, a Boston tenant lawyer can help. An attorney can also offer guidance and advice on other lease terms as well. Contact a lawyer today to get the assistance you need to make informed choices in connection with property rentals.

Posted in Landlord-Tenant Information



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