Many of our rental owner clients prefer their properties be rented for twelve months at a time. The one major benefit to renting under term leases like these is the landlord’s right to simply not renew the lease for any reason, with notice to the tenant at least 60 days prior to the end of the lease term.
Month-to-month tenancies (referred to as Periodic in the State of Washington) are not to be feared. They provide landlords with the greatest amount of flexibility and options to make changes along the way.
What You Can Change With Proper Notice
Most changes can be achieved with only 90 days’ notice to the tenant like:
- Adjusting rent or utilities costs (subject to statutory limits).
- Vacating the property for sale.
- Vacating the property for you or immediate family to occupy as a primary residence.
With a minimum 120 days’ notice, you can terminate the tenancy for the purpose of performing a substantial renovation on the property.
The Myth of “Guaranteed” Income
Oftentimes the argument made for continuing in term leases of six to twelve months at a time is for the benefit of “guaranteed” income. However, did you know that military tenants who receive orders to move are allowed by law to terminate any lease with a minimum of 20 days’ notice without penalty? That’s the same amount of notice a month-to-month tenant must give.
Even non-military tenants may terminate early, which can result in lost income that may not be fully recovered by an early termination penalty.
Considering Your Options at Renewal
So, the next time the lease on your property comes up for renewal, consider the flexibility benefits of month-to-month, and remember that there are never any guarantees.
Please note: Information is deemed reliable but not guaranteed and based upon the current Washington State statute. Some local jurisdictions are more restrictive and provide tenants with more rights.