Renting
Whether you’re renting a home, an apartment, or a room, here’s all you need to know about rental terms, what constitutes a fair lease, and pitfalls to avoid.
Renting
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Inventory is highest between May and September, giving renters the widest range of options. However, demand is also higher during these months, meaning advertised reents will be higher and apartment hunters could face stiff competition in hot markets. Between October and April, renters enjoy less choice but also lower rents and less competition.
Learn More When Is the Best Time to Rent an Apartment? -
Most renters insurance policies will cover at least some natural disasters. It’s common for policies to cover tornadoes and other wind storms, fires (including wildfires), rain (excluding flooding), hail, and snow. Policies don’t usually cover floods and earthquakes, which require additional coverage. Residents of disaster prone areas should consider including loss-of-use coverage, which helps renters cover the cost of finding new housing if their rental becomes uninhabitable.
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Generally, to withhold rent a tenant must inform the landlord of conditions that make the unit uninhabitable and give them time to make repairs. If they fail to do so, tenants can go to court to withhold rent through a process called rent escrow, in which the tenant pays rent to a third-party until the landlord fulfills their obligations. Conditions and processes vary by state, so you’ll need to consult local laws before taking such action.
Learn More How to Withhold Rent Payments in Escrow -
Yes, as with a vehicle, you can enter an agreement to rent a home and buy it outright at the end of the rental term. There are two types of rent-to-own agreements: lease option and lease purchase. Lease option agreements give the renter the right but not the obligation to purchase, whereas lease purchase agreements obligate the renter to buy the property when the lease is up. Rent-to-own agreements can help you build home equity while saving up for a down payment or improving your credit score to get a better deal on a mortgage.
Learn More Rent-to-Own Homes: How the Process Works
Key Terms
- Lease
A lease is a contract outlining the terms under which one party owning an asset agrees to rent it to another party for a certain period of time. It guarantees the lessee (otherwise known as the tenant or renter) use of the property, and guarantees the lesser (owner) regular payments for the period of the lease.
- Accessory Dwelling Unit
An accessory dwelling unit (ADU) is a second, habitable structure on a property with a primary residence. ADUs cannot be bought or sold separately from the house they share a lot with, but they can be rented. ADUs are subject to local zoning laws.
- Tenancy at Sufferance
Tenancy at sufferance refers to a situation in which a tenant overstays their lease without the landlord’s consent. The landlord can either offer the overstaying tenant a new lease, ask the tenant in writing to leave, or, if that fails, file to evict. Despite the illegal nature of tenancy at sufferance, the tenant retains their right to privacy and to file a complaint about unsafe conditions, and both parties are expected to uphold the terms of the lease.
- Rent Control
Rent controls are laws, usually enacted at the municipal level, that restrict how much a landlord can charge as rent. They most commonly cap the maximum rent on a unit and limit how much the rent can be increased from year to year.
- Security Deposit
A security deposit is money a tenant gives to a landlord, usually before occupying a property, to protect the landlord if the tenant damages the property or fails to pay rent. Tenants are entitled to at least partial refunds of their security deposit if they respect the terms of the lease and don’t damage the property beyond normal wear and tear.
- Month-to-Month Tenancy
Month-to-month tenancy refers to an informal agreement between landlord and tenant that the property is being rented on a monthly basis, rather than for a set period of time (usually one year) as with most leases.
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