A residential lease is a contract between a landlord and a tenant that establishes terms under which the tenant is allowed to inhabit the landlord’s property.
What is a residential lease?
A residential lease is a contract between a landlord and a tenant that establishes terms under which the tenant is allowed to inhabit the landlord’s property. Once signed, it guarantees the tenant the right to live in the property. The landlord on the other hand is guaranteed payment. It gives both parties legal protection in case they are wronged and makes it possible to settle eventual disputes using proper legal channels. The commercial use of property requires a specific lease that allows for that. Click here to read the article on commercial leases.
What a lease contains
A lease has to contain certain things to be considered legal and binding:
- Description of the property - the lease has to include a description of the location and physical aspects of the property along with any non-fixed assets like a kitchen, dishwasher, washing machine etc. This ensures that the landlord can make claims against the tenant in the event of damages.
- Name(s) of the tenant(s) - the lease has to contain the names and signatures of all adults living on the property in order for the landlord to claim rent. It also has to be up to date at all times.
- Duration - the lease has to give a description of how long it is valid. This can be until a certain date, for a minimum number of weeks/months/years, on a month-to-month basis or indefinitely with a notice period of 3 months.
- Renewal - if necessary, the lease has to specify how and when the lease has to be renewed. Most leases do not have to be actively renewed as long as the tenant complies with the lease terms.
- Money - all the financial aspects of the lease have to be listed: rent, ancillary costs, fees and security deposit. The mode of payment also has to be specified in the lease.