Month-to-Month Rental Agreement – Pros&Cons

A month-to-Month Rental Agreement is a short-term rental contract that allows the tenant to rent the unit monthly until either tenant or landlord provides a notice to end the lease. The most πŸ”— standard period time is 30 days which is required by most states. It is a practical contract with more straightforward conditions that adapts to landlords and tenants with the same need. Therefore, It differs from a long-term lease agreement because of its flexibility and uncertainty. This monthly rental agreement can extend the existing πŸ”— lease agreement to trustworthy tenants once it expires if both parties are still on good terms without any contract violation.

In today’s article, let’s learn about the pros and cons of month-by-month lease agreements and where you can quickly obtain a professional rental agreement month to month.

What you should know about Month-to-Month Rental Agreement

Month to month rental agreement pros and cons for the landlords

πŸ‘Pros for Landlord

#1 Additional income in high season

  • A monthly rental agreement sounds juicy for some landlords who could squeeze every drop to win more money. They can follow the high season to adjust the rent when the market is in heightened renting demand. To do so, you need to send a πŸ”— rent increase notice to your tenant before raising your rent.
  • Moreover, short-term leases always carry more risk when the tenants can leave at any time with proper notice, which enables them to be charged higher pay rent than a long-term lease.

#2 Flexibility Of Use

  • This rental agreement unlocks the flexibility to use this unit when needed, for example: for family visits, updating the new rental terms for the next tenant, etc. 
  •  Also, some landlords use a tactic to rent out for tourism on Airbnb for a short period instead of a month-month lease agreement. For example, summer is the best time to earn extra money from local and international tourists seeking a unit to rent for a short visit for up to several weeks, depending on the location.

#3 Addressing difficult tenants

  • No one wants problematic tenants on their property, especially regarding πŸ”— late pay rent. However, It is very tricky that some bad tenants may use to not violate the lease by offering partial payment and continually paying late. Conversely, A month-to-month rental agreement gives the landlords another compelling flexibility: to get rid of this type of tenant after a month by providing notice on appropriate days only. With a long-term lease agreement, the owners may have to use πŸ”— an eviction notice and be ready to file with the courts for the eviction process afterward. 
  • Additionally, It is never too late to offer long-term renting if the tenant meets the qualifications and expectations of the landlords. A month-to-month rental contract will be an excellent chance to test a new tenant. 

πŸ‘Ž Cons for Landlords

#1 Extra cost to find tenants

There are a few costs which the owners should bear in mind. As per the general condition of the rental contract, the property must be cleaned and well-repaired before entering the new tenant. Therefore, it also costs money for advertising and time to screen new tenants, set up a meeting to show the units, etc.

#2 Offseason vacancy

If you can earn extra income in the high season, then there will be a lower season where your property can be empty while searching for new tenants. And a vacated property means you will have a loss of income. In this case, a long-term contract often gives more security for payment during this time, such as winter. For that reason, it is crucial to learn about the housing market and the season from where your premises locates to have an adequate strategy.

#3 Uncertain end date

With this Residential Lease Agreement, tenants and landlords can send a notice in days according to state law before vacating the unit. It can affect having any long-term plan, both professionally and personally.

agreement
Source: pexels-rodnae-productions

What benefit can tenants have from using a month-to-month rental contract?

A month-to-month rental agreement can benefit some tenants as below: 

For Flexible Candidates

  • It is an ideal rental contract for students who need a short rent first to settle and adapt to a new city. They may not know the area much, so avoiding the long-term lease before getting to know it is a practical and wise choice.
  • Once the students are familiar with the city, they can negotiate a long-term lease for a better price with the landlord if both parties are on good terms. On another side, they can send a notice of intent to vacate and take time to search out other flats during that time 30 days in advance.

Furnished property

  • Typically, most of the property for the month-to-month lease agreement will be fully furnished, minimizing the cost of moving or buying new furniture
  • . Nevertheless, most landlords tend to offer it to be more competitive and attractive to others and increase the ability to get higher rent.

House Restrictions

  • For short-term living, house restrictions tend to be less restricted than long-term agreements, making this contract appealing as a first option to choose.
  • Furthermore, landlords who need tenants fast to fill the void tend to put fewer restrictions.
  • Last but not least, the rent of this contract is often included gas, water, or electric bill, which means the landlord will be the one who takes care of all the bills, not the tenant.

The bottom line is that a monthly rental agreement is recommendable for people with short-term commitments. It benefits both sides as long as they look for flexibility in the same boat. However, the downside of the monthly rentals is that the rent tends to be higher than the annual leases, and the landlords can vacate the tenants with notice before they are ready to move.

How to Make a standard month-to-month lease agreement In an Easy way

Creating a contract is not easy when it comes to legal matters. The best is to use one standard template to reference all the conditions you may need to consider. Here, offer our editable contract template to help you easily create your contract.

Standard Month To Month Lease Agreement

Edit Month to month rental agreement here an easy editable template month to month lease agreement to create a contract faster

If you don’t know the timeline for returning the deposit, check out the πŸ”—deadline for returning the deposit, state-by-state, provided by Nolo.com