If you found the perfect tenants at the outset, you want to provide a fair rental rate as well as lock them into a longer term contract. How long is long term? Most leases are for 12 months so anything longer than that can be considered long term.

A long term lease makes sure your excellent tenants staymonth to month lease there longer and you don’t have to market the property to find new tenants and possibly experiencing a vacancy while the property is being repaired and new tenants move in. On the other hand, bad things can happen to good people and situations change. Good tenants might find they’re unemployed one day and suddenly have a problem paying the rent.

A month to month lease agreement is always an option and can be a way to charge more for rent each month compared to an annual agreement. Such situations, whether the lease is indeed month to month or for a two or three month period, provide an answer in areas where employers may have employees transfer for one or two months then leave.

A month to month lease is many times found in an original 12 month or longer lease when it expires. For instance, at the end of a 12 month lease, the agreement automatically converts to a monthly lease. That also means you don’t have that unit locked up and the tenants can give a 30 day notice and move, making the landlord suddenly scramble to find new renters and avoid a blank month.

Generally speaking, month to month leases favor the renter as there is more flexibility in spite of the fact the rent may be higher compared to signing a longer term lease. For landlords, finding good tenants makes for a maintenance free lease. It pays to keep them longer, not shorter.