With the current economic climate, many Americans are choosing to rent their home instead of buying. There are more than 44 million renters in the United States.
This comes as no surprise due to unfavorable conditions for homebuyers. Home values are historically high, meaning that homebuyers need larger down payments. Mortgage rates are more than 7% in some cases, leaving homebuyers with higher monthly payments.
Households are quickly learning that renting is the better option. However, you need to lock in favorable terms in your tenancy agreement.
Read on to learn five things your rental agreement should include. Explore housing topics such as rental contracts and what property management services do.
1. Payment Terms
Payment terms are what landlords and tenants are both most interested in. This section of the rental agreement states the rent amount and frequency. While most rental agreements require monthly payments, there is flexibility for biweekly or quarterly payments.
This section also lays out how the landlord wants to be paid. Does the landlord only want cash or checks, or do they accept other forms of payment like Venmo? Other topics covered in this section include penalties for late payments or bounced checks.
2. Repair and Maintenance
Like any house, things are going to eventually break. Whether it is an appliance or something structural like the roof, a process needs to be in place to fix it.
The rental agreement requires a section that details this process. It should inform the tenant whom to contact in the event of a repair or maintenance.
It should also provide information on how quickly the property management company will respond. Other relevant information is what the property management company is responsible for fixing.
For many renters, a landlord’s pet policy is a make-or-break point. Pet owners cannot move into an apartment or house that does not allow their animals inside.
The rental agreement should clarify what the property’s pet policy is. It should also lay out penalties in the event that a tenant breaks the policy and damages the living spaces.
4. Rental Term
The term of the rental agreement is critical. Some renters want a long-term agreement while others want flexibility.
It is often an item up for negotiation. The standard rental term is one year. Reopening negotiations every year allows the landlord to raise rent or adjust problematic clauses in the contract.
The landlord often uses the rental agreement to place limits on the occupants. For example, they may state specific limits on the number of people allowed inside the property.
The rental agreement may specify the maximum number of people who can live within the property. It may also state the max number of guests for social events as well.
Your Guide to Tenancy Agreements
This is just a short list of items you may see in the rental agreement. Your contract may be more complex and it is typical for tenancy management services to assist.
If you require help drafting a tenancy agreement, contact us today to speak with an experienced professional.