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Updated about 5 years ago on . Most recent reply

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Colin Spivey
  • Rental Property Investor
  • Nashville, TN
11
Votes |
58
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What should I have the length of my lease at?

Colin Spivey
  • Rental Property Investor
  • Nashville, TN
Posted

I am looking at buying my first rental property either this spring or this summer. I am looking at purchasing a run down home and BRRRR'ing it into a B class property. I talked to my lawyer and he said with a lower income type property that it is better to renew the lease in 3 or 6 month intervals so that I have to option to terminate the lease rather than find grounds to go through and eviction if the tenant is not following the lease or paying rent. He said he recommends his clients with A class properties to get their tenants into a year or two lease because these tenants are statistically more trustworthy, but a B or C class property statistically house tenants who have more problems. I see his point but if I do my due diligence in the application and screening process should I still only keep a lease for 3 or 6 months. Is it that big of a deal to renew a lease every 3 or 6 months (I will be self managing the property)? I would just like to hear other's opinions on this subject. Thanks

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Bjorn Ahlblad
#5 Multi-Family and Apartment Investing Contributor
  • Investor
  • Shelton, WA
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Bjorn Ahlblad
#5 Multi-Family and Apartment Investing Contributor
  • Investor
  • Shelton, WA
Replied

@Colin Spivey determine what the custom is for your area. What your lawyer said is interesting; but getting in step is more important. Also become familiar with market rents. Do your own research. If practical don't end leases in the dead of winter if y'all get winter where you are. My properties are all pretty much B and all my tenants are MTM; as is customary for the area. All the best!

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