When you own various rental properties, you have many decisions you must make. You not only need to keep the property in tip-top condition, but you need to find tenants who will pay you on time, take care of your property, and keep your belongings in excellent condition. As a landlord, one critical decision you must make is determining which contract types you plan to offer. While long-term leases are popular and quite common, many individuals need something for shorter periods of time. They may only be in the city for a few months or they are searching for flexibility that the long-term ones do not provide.
As you consider a short-term lease for your rental properties, there are several different options that you may consider.
One of the most popular short-term lease options is month-to-month. This option allows tenants to stay in the property for a month at a time. The tenant can cancel the rental with as short as a 30 or 60-day notice. There are many benefits for both landlords and renters with this option. As a landlord, you won’t have to deal with troublesome tenants for the long term. In many cases, these individuals will rent your property for a few months at a time, so if your tenants are not paying you, are damaging the property, etc., you can terminate the lease and evict them much faster than other contract options.
Furthermore, with a month-to-month option, there are more opportunities to make money. Many individuals understand that with this option, rent payments will cost more than those with long-term ones. Plus, you can also charge more for deposits and fees. As your tenants change, you can easily raise prices and make more money without upsetting your current tenants.
Many renters are also looking for month-to-month options as this provides them with ample flexibility. They may be on a long-term business trip and want an apartment, rather than to stay in a hotel for several months. Or, they may be in the process of purchasing a home on their own but need a place to stay while they are waiting for their closing date or for renovations to be completed. Plus, many tenants like the option that they can leave at any time and they do not have to stay in the same place for months at a time.
However, there are some drawbacks to this contract option as well. You will need to work harder and more often to fill vacancies. You may lose out on income if you are not able to fill vacancies quickly and your apartment is not in high demand. Luckily, when you work with companies like Blueground, they take care of this burden. Our apartments are in high demand thanks to a strong base of business tenants and you don’t have to worry about long-term vacancies. We handle every aspect of the rental process so you don’t have to.
Another short-term lease you may consider is a sublease. This option is a little more unique as the original leaseholder may need to leave the apartment for a short period of time so they rent it out to a new tenant. This is ideal for individuals who may leave their current apartment for a summer internship or care for an ill family member, etc. This ensures that the original leaseholder still has a home to live in but someone is caring for the place while they are gone.
As with other contract options, there are many pros and cons to this particular option. As a landlord, you will want to ensure there are strict rules in place for this option. For example, you may need to specifically state that the original leaseholder is in charge of all missed payments or additional fees that must be paid.
However, this option can cause more worry and concern, and you need to ensure that you take the time to conduct background and security checks on all tenants who you choose to sublease to. If subleasing is not an option you wish to offer your tenants, make sure that is specified in your original lease agreement.
Many renters may like the idea of a sublease as it gives them a place to stay for a short period of time. But, for both the original leaseholder and yourself as a landlord, it is risky and something you want to carefully consider before you agree to it.
A short-term lease is attractive to tenants for many reasons. However, as a landlord, you want to carefully weigh the pros and cons of each type of option. These options can cause you more stress and work. But, you can also make more money and attract tenants who are seeking the flexibility and the freedom that these options offer.