Form-of-the-week: Residential Lease Agreement – Form 550
Periodic and fixed-term tenancies distinguished
Residential landlords and tenants either enter into a:
- periodic rental agreement; or
- fixed-term lease agreement.
Residential periodic tenancies take the form of month-to-month rental agreements. [See first tuesday Form 551]
When leasing a residential property on a fixed rental-rate basis for a specific period of time, a lease agreement is used. [See first tuesday Form 550]
Both residential rental and lease agreements grant and impose on the landlords and tenants the same basic rights and obligations. Their differences lie in the expectation of continued occupancy and the obligation to pay future rent.
A month-to-month rental agreement runs for an indefinite period of time. The tenant’s right to occupy the property on the same terms automatically renews monthly, until modified by the landlord or terminated by either the tenant or the landlord. [See first tuesday Form 551 §3]
Periodic tenancies may be terminated by either the landlord or tenant on 30 days’ written notice. As an exception, when a residential tenant’s occupancy of a unit exceeds one year, the landlord needs to serve the tenant with at least 60 days’ written notice. [Calif. Civil Code §1946; see first tuesday Form 569 and 569-1]
On the other hand, a lease agreement creates a tenancy that continues for a fixed period of time. At the end of a fixed-period tenancy, the tenant’s right of possession expires as agreed. The termination of the tenancy is set by the expiration date in the lease agreement. No further notice is required by either the landlord or tenant to terminate the tenancy. [See first tuesday Form 550 §3]
Unlike a periodic tenancy, the lease agreement does not automatically renew, unless:
- the landlord accepts rent for the tenant’s continued occupancy after expiration of the lease term, which creates a month-to-month tenancy [See first tuesday Form 550 §3.3]; or
- an option to renew or extend the lease has been provided in the lease agreement and exercised. [See first tuesday Form 550 §1.3]
first tuesday’s Residential Lease Agreement is a fixed-term lease agreement used by a leasing agent, property manager or landlord when leasing a residential property on a fixed rental-rate basis for a specific period of time, to grant the tenancy and set the terms for rent and conditions for maintenance.
The Residential Lease Agreement:
- sets the amount of rents to be paid;
- identifies who will provide and pay for utilities; and
- allocates the maintenance responsibilities and their costs between the landlord and tenant. [See first tuesday Form 550]