One of my tenants has a lease ending 11/30/17. He is looking at buying a house and has inquired about whether I would be interested in selling the property. If not, he has another property in mind and was wondering if he could go month to month after lease end for 1 to 3 months
I am not planning to sell the house but had a couple of questions:
- Are there things that folks have done to entice renters to stay longer?
- Do you typically charge higher rent for month-to-month and if so, what percent higher?
- Any other concerns of allowing him to go month-to-month vs. just getting another tenant on a year lease?
Thanks in advance for any feedback.
My leases automatically go to MtM at the end of the first year. Allows me more flexibility and control if things go south, and also gives tenant options. Rent typically does not go up unless it was going to go up anyway at the end of the lease. 30 days notice required on either party to end the MtM. I personally prefer these.
I only rented month to month.. so never was a issue with me.. you can request a 60 day notice if possible.. and I'd up the rent just because the original term lease was done.. who knows he could continue living there for quite awhile..
I would guarantee the rent rate on my month to month tenants after a increase,, or with a new tenant for one year..
Our leases always contain a hold-over clause. When the lease expires it reverts to a month-to-month and requires 30 days notice to vacate. The holdover clause also has an increased rental premium. This typically incentivizes the tenant to sign a new 1 year lease. If they don't, at least I get a little extra which compensates for the lack of stability.
It sounds to me like your tenant has his heart on owning property as opposed to renting. In my experience their is little you can do to keep them as a long term tenant.
You mentioned you don't want to sell, but have you considered all of your options? You may be able to do seller financing where you could get a decent interest rate and essentially have good cash flow for a long time with no overhead. If your (now buyer) defaults on the mortgage, you get the property back.
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