Kelevra Enterprises

We assume this perspective may depend on the location and condition of your rental property, but this debate, for now, focuses on residential apartment leases.

We recently executed our first month to month lease for a tenant, based on marginal credit scores and in hindsight it got us thinking about why we ever write one year leases...

What good is a one year lease really? If a tenant up and leaves 7 months into a 12 month lease regardless of what condition they leave the unit in... you keep the deposit and what, pay attorney fees to "squeeze blood from a turnip" or "chase your tail"... You may be able to place a lien on a person which will stay in place until they go to purchase a big ticket item, such as a vehicle or home, etc, at which time they must make amends and hopefully own up... But at what cost...

Quick example:

5 months rent @ $600/mo = $3,000

Atty Fees - Approx. ($500)

Court Filing - ($500)

Additional Vacancy and possible repairs ($1,200)

So, your left with approx. $800 bucks at some future time...

We have become enamored with Month to Month leases for the simple fact that if the tenant is terrible and violates the lease agreement or is just plain not a good neighbor, then 30 day notice and everyone can move on...

Obviously, consult an attorney and discuss fees and options, but it has worked well for us... The only downside is of course, some folks may want a longer commitment, but if they are strong candidates for renting, then make the necessary concessions... Also, obviously make sure you adhere to all housing guidelines and rules.

Has anyone had any different results or for that matter, different tactics?