Quote from @Joe Capobianco:
I've brought a new yearly lease to my tenants 3 consecutive years now and the only thing changed on it is the dates of start and end. As im asking questions to my friends and family about their lease I realize some of them have not signed a new lease since the intial signing or have every few years. I wasn't aware how common this was and thought it was natural to re sign a new lease after expiration if they expect to stay here.
I'm writing this to see if anyone else signs leases every year without any updates or am I doing unnecessary steps?
should I only be doing this if I am changing specifics on the lease to show we both agree to the new terms?
Aloha,
From your post is sounds like you are meeting with them to sign a new 5 page or whatever complete agreement. NO, that is not necessary. Typically, prior to or shortly after the end of each annual period, I schedule a walk through inspection of the unit. Once I have completed the inspection, I have a brief conversation with tenants asking if everything is working properly or if there are any issues that need attention; and I ask what their intentions are...do they hope to remain another year, or do the perhaps plan to move in six months for some specific reason. They might state they are planning on purchasing a home...which might be an opportunity for you. In any event, I typically will offer their renewal based on their plans and after review of the current market. Inevitably, they will ask "are you going to raise the rent?". I tell them we will send out a renewal notice that will have that information on it, but at this moment I have not evaluated all of the factors yet.
All that is needed is a simple one page addendum. You reference the original (or most recent complete) agreement as to the parties, the date of the agreement, and the premises. The template I use has three elements that are typical change items: Tenant Names; Rent Amount; Rent Term. Whichever element is not applicable for the current document, I delete. Indicate the new Tenant/Rent/ or Term and the effective date (45 days or per local law).
If you are changing the Rent Amount, you need to also address Security Deposit, which typically should match the current rent.
The lower portion of the template offers three options to the tenant: Agree with the new element; Tenant gives 30 day (or as appropriate by local law) notice they will vacate; Tenant proposes counter option which PM must approve to be effective.
A deadline is provided to return the completed document (about two weeks in advance of the otherwise effective date).
For change in Rate or Term, all current tenants must sign and date. For change in Tenants (roommate change, removing or adding party) all incoming or vacating and remaining tenants must sign and date. If a current roommate is vacating, and a new one is moving in, we do two forms, one for outgoing, one for incoming, AND we do not deal with Security Deposit or Condition Inspection...tenants need to handle that among each other. We only perform move out when entire unit is vacated, returning any deposit to the then current tenants based on condition at that time, compared to original move in inspection.
Once I sign the addendum after it has been completed and returned, it becomes attached to the Rental Agreement and goes into effect on the stated date.
