Less than 12 month term leases

[Ruben Galindo]

I currently have eight long-term rental with one more closing on December 1, 2021.  I recently started marketing terms of less than 12 months.  Good idea or not a good idea?  Why or why not?  If it a good idea besides higher rent rates and higher security deposits what else should be different than a 12-month lease???

Just want to get everyone's thoughts...

[Bryan Balducki]

@Ruben Galindo I tend to allow shorter terms if the tenant is moving in after Summer, that way the lease expires in Summer. In Denver anyways, it is way easier to rent out in the Summer compared to the Winter. The last thing I want is a lease expiring mid winter, so I tend to use different terms in this case. I also have had month to month leases, and each one has stayed for over a year. These leases did complicate my next loan, so I’d keep that in mind. Banks like to see 12 month leases and up when using rental income to offset expenses. Hope this helps!