A lease or rental agreement is a contract in which a property owner, the "landlord" or "lessor," agrees to let another person, the "tenant" or "lessee," use the owner's real property in exchange for something of value, which is usually money in the form of "rent." For a variety of reasons, millions of Americans rent the property they live in, from single room apartments to single-family homes.
Residential leases are usually pretty long and try to cover all of the parties' rights and responsibilities. There are many things that a lease must contain, like the parties' names, and there are things that it can provide for, such as detailing who has to pay for utilities. There are also things that a lease can't state, such as a tenant's waiver of his right to a refund of a security deposit.
Usually, state law controls the contents of a lease, and those laws vary. So, whether you're a landlord or tenant, be certain to check the laws in your area, or seek the advice of an attorney experienced in real estate law, before signing a lease.
Necessary Elements of a Lease
Generally, if the term of a lease is for one year or longer, it needs to be in writing. A lease can be an enforceable contract, regardless of whether it is written or oral, but having it in writing makes it easier for all parties to understand and enforce their rights and obligations.
Some of the things that need to be in the lease include:
- The names of the parties, that is, the full name or names of all landlords and tenants. Also, each party must have the "legal capacity" to enter into a lease. Generally, anyone can execute a lease except for minors, typically persons under 18 years old, and persons of "unsound mind."
- A description of the land, which should be as precise as possible include things like the complete street address, with city or town, state, and zip code; and, if applicable, building and apartment numbers. In addition, if there are common areas that tenants have access to, such as storage areas or parking spaces, they need to be listed, as well as any personal property that goes with the premises, such as with a "furnished apartment."
- The amount of rent that the tenant has to pay, as well as when it must be paid, how it must be paid (cash or check, for instance), and if there'll be a charge for late payments.
- The length, or "term," of the lease.
In those states that require a lease to be in writing, a lease is invalid if it fails to describe the land, specify the length, or set the amount, time and manner of rent payments.
Common Lease Provisions
Most residential leases contain numerous provisions on various things, which help both the landlord and tenant understand their rights and responsibilities, for instance:
- The amount the tenant must pay as a security deposit
- Whether the landlord will pay all or part of the utilities, such as gas and electric, but also cable or satellite television services
- If pets are allowed
- If parking is available for the tenant
- Who's responsible for normal upkeep-those items beyond the tenant's responsibility to keep his or her living space clean-such as mowing the lawn
- The landlord's duty to keep the premises habitable, or "livable," by ensuring things like adequate water, heat and power
- Each party's duty or responsibility for getting and maintaining appropriate insurance
- If, how and when the lease can be terminated or ended early by either the landlord or tenant
- How many tenants can be on the premises, and whether rent will increase if additional tenants move in
- If the tenant can "sublet" the premises, that is, rent it to someone else
- When the landlord can enter the leased premises, either with or without the tenant's permission
Again, while the state laws on the topic vary, in many states a residential lease can't contain provisions that:
- Children are not permitted to live on the premises, unless, as in most states, the residence qualifies as some type of "senior housing" or "senior facility"
- Persons of various race, color, sex, religion or national origin
can't be tenants
- The tenant waives his or her right to a refund of his or her security deposit
- The landlord has no duty to keep the premises habitable
- The tenant waives his right to file a lawsuit against the landlord at any time—either while the lease is in effect or after it expires—for damages suffered by the tenant as result of the landlord's conduct or failure to act, such as if the tenant is injured because the landlord failed to repair faulty stairs or flooring
- The landlord has greater rights to enter the premises than those specified by state law, or that the tenant has fewer remedies than those provided by state law if the landlord enters the premises unlawfully
In some states, if a lease contains any of these things, it is invalid and unenforceable. In addition, if a landlord deliberately uses any of these provisions knowing that they are prohibited, tenants can recover actual damages of up to three months rent and reasonable attorney's fees.
Questions for Your Attorney
- My lease specifies rent at $500 for 12 months. My landlord says she's raising it because the "cost of living" has gone up." Can she do that?
- My lease doesn't say anything about pets, and when I got my first dog, my landlord didn't say anything about it. But, I just got another dog, and the landlord is making me get rid of one. Can he do that?
- Should I record the lease for my rental property with the land office or recorder's office? Should I tell my tenant to record the lease?
- Can I require my tenant to get renter's insurance before I rent to her?