Knowledge is Power: Understanding a Residential Lease Agreement

Updated April 28, 2022

As a property owner, it's essential to understand the lease agreement. However, even if you created it, there could be terms or disclosures that require additional insight to understand every element fully. 

A lease agreement is a legal contract between a property owner and tenant. Your rental lease agreement should be detailed to include the conditions under which the tenant can occupy and use the property. If your document is currently a simple one-page lease agreement, it could be missing some critical elements—leaving your property and income vulnerable.

Make sure to read through every lease with an expert before tenants sign it. Keep reading here to get our expert Boston property management insights about a few details included in most lease agreements.

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The Security Deposit, Fees, and Monthly Rent Amount

The monthly rent amount and due date are elements you probably have in your lease. However, additional costs may need to be documented in the rental agreement, including various deposits and fees. Any deposits, such as an upfront security deposit or fees for parking or pets, should be clearly stated, as well as the conditions for getting any security deposit returned.

Details about the rent should include the pay rent amount and when it's due, when it is considered late, late fees, and the payment method (whether online or by check). The lease agreement should also include how to renew a lease when the term ends. 

Your lease can also include whether you require the tenant to buy renters insurance.

Routine Maintenance and Repairs

In most landlord-tenant situations, the residential property owner is responsible for all repairs and maintenance, including a leaking faucet or a faulty air conditioner. In other cases, the landlord may be responsible for big-ticket items like major appliances, and the tenant pays for everything else. The lease should make maintenance and repair responsibilities clear. There should also be a provision to document who is responsible for caring for the yard or outside spaces.

Ensure the lease agreement is specific about who is responsible for what and how much time the landlord or tenant has to address concerns.

What the Rental Home Includes

In most cases, permanent kitchen equipment (such as a stove or oven) is included in the rent. However, if the unit has removable fixtures like window shades, pool equipment, or a microwave, make sure to state what stays in the rental property when the tenant moves out.

To Remodel or Not

Most lease agreements require the landlord's permission before a tenant can make updates to the property—even cosmetic changes. If it's in the lease and complies with the law, you may be able to recoup costs associated with returning the rental property to its original condition if a tenant makes modifications without your permission.

The lease agreement needs to clearly state what types of modifications the tenant can (and can't) do and how they should contact you or your property manager to get permission to make any changes. Work with a property management company to learn more about what types of repairs can be deducted from a security deposit.

Pet Policies

If you allow pets in your rental property, include a pet policy in the lease. In addition to the base rent, additional costs may be imposed as part of the lease. There may also be restrictions on the sort of animal, breed, or size. 

Emotional support animals and service animals are protected by the federal Fair Housing Act, which bans landlords from discriminating against disabled persons. If mental health professionals determine that an emotional support animal (ESA) is necessary to help your tenant, property owners must allow it in the property. 

If you decide not to allow pets in the rental property, a no-pet clause also needs to be included in the lease agreement so that it is clear to the tenant. 

Other Rules of the Property

To help tenants understand how they can use your property, a standard residential lease should describe the property's permissible uses. This section could also include additional policies for things like:

 

  • The number of occupants
  • Guests
  • Quiet hours
  • Parking and storage areas
  • Smoking
  • When a landlord can lawfully enter
  • The eviction process

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Clarify Language In the Lease Agreement

After creating the lease, read through it. Sometimes the language for required disclosure can be unclear to property owners and tenants. Consult a professional property management team or your attorney to make sure you understand and can explain every aspect of the agreement to your new renters. 

Always have a real estate attorney check over residential leases to ensure they are legally binding and could stand up in court if needed. Save a copy of the lease once you and your renter have signed it. You'll need to consult the signed document if there are any disputes regarding the property or the rental lease agreement.

Understand Lease Agreements With a Boston Property Management Company

Drafting a rental lease agreement template should not be taken lightly. Enlist the help of a real estate attorney or a Boston property management company to make sure your lease is ironclad, and every item is clear!

CHARLESGATE Property Management has years of experience dealing with lease agreements for residential rental properties. Give us a call to look over your lease or to help draft your next one.

Our free resource helps property owners understand the basics! Get your free copy of "How To Create a Custom Lease Agreement."

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