Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
I read something recently where a landlord provides a rent guarantee certificate listing the amount & the length of time (usually a year) & then creates a month-to-month. He strongly urges this concept (he has thousands of properites).
The #1 reason renters do not want to sign a month-to-month 1st year lease, he says, is because they're afraid the rent will be increased within the 30 days. This alleves their concerns.
The landlord can terminate the lease if the tenant doesn't pay or acts up. The downside is, so can the tenant.
But given today's landlord market, your worst enemy is an eviction, especially in states where they can be drawn out.
That is an interesting idea... I guess it would depend on your motivation. Why a month to month lease? If the property is listed, or will be soon, then that would make good sense. But it doesn't make good sense if you are concerned about "evicting" a tenant. Just telling a person that the lease is cancelled will not make a stubborn tenant move out any more than an eviction notice.
Vacancy and rental turnover is a quick way to lose whatever profit you have made that year. Having a month to month lease only increases the risk of losing 1 or more months of rent when your tenants keep moving in and out. Add on top of that the additional repairs you will need to make to keep getting a unit ready to rent. I do not think the risks justify the convenience.