Lease Management: Renewals, Amendments, and Terminations

During a fixed term, neither side can change the lease alone, so record every change in a written addendum that you and every tenant sign; a month-to-month tenancy can usually be changed by written notice. When the term ends, the lease is renewed, rolls into a month-to-month tenancy (in California, for example, when you accept rent after the end date), or ends on the written notice your state requires, such as at least one month in Texas and up to 90 days in New York for long-term tenants. In New Jersey, much of California, New York's Good Cause areas, and most of Washington, the end of a lease term is not by itself a legal reason to make a tenant leave. A lease can also end early when a tenant breaks it, under military orders or a domestic violence termination right, or through a signed move-out agreement.

What the lease should settle at signing

These terms decide how a later renewal, change, or early exit plays out:

• Term and end: every adult occupant signs, and the lease states the end date, whether it renews, converts to month-to-month, or ends, and the notice each side must give.
• Money terms: rent, due date, payment methods, and late fees within your state's limits (see rent collection systems), plus the deposit amount and return terms (see security deposit management).
• Use of the unit: entry notice, guests, pets, and who handles repairs.
• Required disclosures: for housing built before 1978, federal rules require you to disclose any known lead paint or hazards and give the EPA lead pamphlet, any lead reports you have, and a Lead Warning Statement in the lease; keep the signed copy for 3 years. Texas leases should include this sentence: "Tenants may have special statutory rights to terminate the lease early in certain situations involving family violence or a military deployment or transfer." Without it, a tenant who ends the lease under those rights also owes no unpaid rent due on the termination date.

Renewing: a new lease, a renewal addendum, or month-to-month

Start renewal talks 60 to 90 days before the end date, because the notice you owe before raising rent or declining to renew can be that long. A tenancy continues in one of three ways:

1. A new lease for a new term, when several terms change.
2. A renewal addendum stating the new end date and rent, with all other terms unchanged, signed by you and every tenant.
3. Month-to-month. In California, if you accept rent after a fixed term ends, the tenancy becomes month-to-month with the old lease's other terms intact.

Rent increases carry their own notice rules. For a month-to-month tenancy, California requires 30 days' written notice when the increase, added to any others in the past 12 months, is 10% or less, and 90 days when it is more; add 5 days if you mail the notice from within California. For units under California's statewide rent cap, an increase over any 12 months is limited to 5% plus inflation or 10%, whichever is lower. New York requires the same 30, 60, or 90 days' written notice shown in the table below before a renewal with an increase of 5% or more; if you give it late, the tenancy continues on the existing terms until the notice period runs. Under the Good Cause Eviction Law, the notice, like every lease, renewal, and legal notice, must also state whether the unit is covered and, if not, why. Setting rental rates covers how to price the renewal, and tenant retention strategies covers how to present it.

How much notice to end a tenancy or not renew

California's Tenant Protection Act does not cover a duplex where the owner lived in the other unit when the tenancy began and still does, or buildings with a certificate of occupancy issued in the past 15 years, and many single-family homes and condos are exempt if you give tenants the required written exemption notice. For a covered unit, a tenant's refusal to sign a renewal on similar terms after your written request is itself a legal reason ("just cause") to end the tenancy. If you end a covered tenancy for a no-fault reason, such as moving in yourself, you owe relocation assistance of one month's rent, paid within 15 days of serving the notice or credited by waiving the last month; the notice must state which you chose, and a notice that misses these steps is void.

Changing terms in the middle of a lease

Write each change as an addendum that names the parties and unit, quotes the clause being replaced, gives the new wording and start date, and states that every other term stays the same. Every tenant on the lease signs it. Common addenda add a pet or an occupant (screen the person first), assign parking, or grant a rent concession with a stated end date. In California, a month-to-month tenancy's terms can instead be changed by written notice, normally 30 days.

When a lease ends early

The tenant breaks the lease

Texas requires you to try to re-rent a unit a tenant abandons, and a lease clause waiving that duty is void. In Florida, once the tenant leaves you can end the lease and the tenant's liability, re-rent in good faith and bill the tenant for the shortfall, or hold the tenant to rent as it comes due. A Florida early termination fee is enforceable only if the tenant signed a separate addendum when signing the lease, the fee is no more than 2 months' rent, and the required notice is no more than 60 days. If the tenant chooses that fee, you give up rent beyond the month you retake the unit. Keep dated records of every listing and showing to prove your re-renting effort.

Military orders

Under the federal Servicemembers Civil Relief Act, a tenant who enters active duty after signing, or who receives permanent change of station orders or deployment orders of 90 days or more, can end the lease with written notice and a copy of the orders. For a lease with monthly rent, the end date falls 30 days after the first rent due date that follows the notice: a tenant whose rent is due on the 1st and who delivers notice on June 20 has a lease that ends July 31. You cannot charge an early termination fee, and rent paid for any period after the end date must be refunded within 30 days.

Domestic violence

• California: 14 days' written notice with a protective order or police report issued or made within the past 180 days, or a statement from a qualified third party such as a doctor or advocate. The tenant owes rent for those 14 days unless you re-rent sooner, and if the restrained person is also a tenant, that person stays bound by the lease.
• Texas: 30 days' written notice after the tenant gives you a protective order or documentation from a health care provider, mental health provider, or advocate. If the abuser is a cotenant or occupant, the tenant does not have to give the advance notice.
• New Jersey: the written notice must name the person posing an imminent threat of serious harm to the tenant or a child and come with a restraining order, police record, medical record, or certification from a domestic violence specialist or social worker. The lease ends 30 days after you receive both, rent is prorated, and any co-tenant's lease ends too unless you offer a new one.

A signed move-out agreement

When both sides want out, a mutual termination agreement, often called cash for keys, ends the lease on a set date. Put in writing the move-out date, the payment and when it is paid (for example, at key return after a walkthrough), the required condition of the unit, how the deposit will be handled, and a release of other claims. If the tenant stays past the date, the next step is the court process in the eviction process guide. Self-managing vs hiring a property manager covers who handles this paperwork.