If you’re a landlord renting out a property, having a written rental agreement is one of the most important steps you can take. A written agreement serves as proof of the terms you and your tenant agreed upon and can greatly improve your chances of a favorable outcome if any legal disputes arise.
However, for the rental agreement to be effective, it must include certain essential terms and details.
What Is a Rental Agreement?
A rental agreement is a written document that serves as a contract between a landlord and a tenant. It outlines the terms and conditions of the tenancy and sets clear expectations for both parties. Because you decide what to include, you can structure the agreement in a way that best protects your property and interests.
Most rental agreements are short-term arrangements, such as month-to-month rentals, while lease agreements are typically used for longer periods, such as six months or a year.
A rental agreement is particularly useful if you want to evaluate a tenant’s reliability before committing to a long-term lease or if you are renting a room in a property where you also live. Month-to-month agreements are generally easier to terminate than long leases, making them a flexible option.
How to Write a Rental Agreement
A month-to-month rental agreement should include specific provisions to ensure that you, as the landlord, are fully protected. Even a simple one-page document should cover essential details. It’s often advisable to seek legal advice when drafting an agreement, especially if it’s your first time renting out property.
While many additional terms can be included, a basic rental agreement should cover at least the following 10 points:
1. Identify the Parties and Property
Clearly state the names and contact information of all tenants who will be living at the property. Include your own name, contact details, and the property address. If the property does not have a unit number, describe it precisely — for example, “third-floor bedroom” if there is only one bedroom on that floor.
2. Term of Tenancy and Termination
Specify the length of the tenancy, such as month-to-month or a fixed term. Clearly state when the tenancy begins, ideally on the first day of the month, and outline how much notice is required from either party to end the agreement. Be sure to check local laws to ensure compliance with notice requirements for terminating a rental agreement.
3. Rent and Security Deposit
Indicate the monthly rent amount, the due date, and how the tenant should make payments. Include payment methods and the address for sending rent, if applicable. Mention any late fees (within legal limits) and the amount of the security deposit. It’s important to check local regulations regarding deposit limits and acceptable fee amounts.
4. What’s Included in the Rental
List any utilities you are providing, such as electricity, gas, water, or internet. Clearly state which utilities are the tenant’s responsibility. If appliances or furniture are included, name them specifically — for example, refrigerator, stove, bed, or couch — to avoid misunderstandings.
5. Pets
Clearly state whether pets are allowed. If they are, specify the type, size, and number of pets permitted, as well as any additional fees. If pets are not allowed, make sure that is clearly stated in the agreement.
6. Occupants and Number of Tenants
List all authorized occupants and specify the maximum number of people who may reside in the property. If you do not allow additional occupants, make this clear and state that the agreement is solely between you and the named tenant. You should also state whether subleasing or assigning the rental is prohibited.
7. Landlord’s Access to the Property
Include terms that specify the notice period required before entering the property for maintenance, inspections, or repairs, except in emergencies. Local laws may dictate the minimum notice period, so check regulations before finalizing this section. You should also outline the tenant’s responsibility for minor repairs and make it clear that denying access for necessary work could be grounds for termination.
8. Rules of the Tenancy
Outline all expectations regarding tenant behavior. This may include prohibitions on illegal activities, smoking, or excessive noise after certain hours. Make it clear that violating these rules may lead to termination of the agreement and that tenants will be responsible for legal fees if court action is necessary.
9. Damaged Property
State that tenants are responsible for any damage beyond normal wear and tear. Require the property to be returned in “broom-clean” condition upon move-out. If legal action is needed to recover costs for damages, specify that the tenant will be responsible for associated legal fees.
10. Signatures
Both you and the tenant must sign and date the rental agreement. This final step makes the document legally binding and ensures that both parties agree to the terms.
Conclusion
Including these essential terms in your rental agreement helps protect you as a landlord and sets clear expectations for your tenant. With a well-written agreement in place, you are better prepared to handle any potential disputes and safeguard your property.
A rental agreement also establishes mutual responsibilities and ensures both parties understand their obligations. By clearly defining the terms, you create a professional and transparent rental arrangement that reduces misunderstandings and helps build a positive landlord-tenant relationship.
