Inherited tenants, offer new month to month lease?

Question

Inherited tenants who were on month to month lease and I gave them their 30 days notice of rent increase. They want to sign a new lease but I want to see what kind of tenants they are before offering them long term/12 month lease. If I offer them my new month to month lease, is it considered continuation of their previous tenancy to avoid short term rental? Can I use their previous month to month lease with new rent? Maybe offer 7 month lease to try them out? Suggestions please.

Ally Kumar · Answer

@Karen F.

@Nathan G.

@Kelly DeWinter

Thank you all for taking the time to reply and for valuable advice. I have heard anything less than 6 months rental is considered short term rental and may have hotel/transient dwelling tax or other implications. I am not sure if it applies to month to month lease?

Karen F. · Answer

I don't see how it could, but that would be dependent upon the laws in your state.

Karen F. · Answer

We recently were in this position. We bought a property with tenants in place, and most of them had either no lease or were month to month on old leases. Shortly after the closing, we gave them OUR lease, on month to month basis, with small increases if appropriate (all of the rents were below market, and some of them were 25% below market). Some of the tenants signed the leases, and paid the increased rent. Some didn't, didn't pay rent, or didn't pay the new amount (which was maybe a 5-10% increase, still below market). Now we knew who our problems were. We served them with a notice to quit the first day it was legal - that ended ANY lease they had. When they understood that it was either pay their rent or leave or get evicted, we told them that they could stay, with signing the new month to month leases with the increased rent, and paying added rent $100/month to build up security deposits (many had NO security deposit).

In my mind, the only benefit in this situation of giving them a long term lease, since they were already in place, was to the tenant, not to us. This way, if there was a problem tenant, we weren't committed to them. We do all our leases as an initial 12 month period, because we had to get the apartment ready for them, and then after that they all revert to month to month.

Nathan Gesner · Answer

I recommend you use your lease with a month-to-month term for six months. See how they pay and take care of the place. Inspect. If everything looks good, sign a one-year.

Kelly DeWinter · Answer

A lease ends per the terms of the written lease.You can offer a new m2m lease at the new rate with a 30 day notice to vacate or any period of time.

Inherited tenants, offer new month to month lease?

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