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Sunday, January 3, 2010

Landlord Series - Tenancy Agreement (part 3)

The Landlord Series are various tips to help the owner of a property become a better and more informed landlord.

In this series we explain the Tenancy Agreement (part 3).

In Part 2 we explained the Pros and Cons of leases (

Today we are going to explain the different term lengths of a lease.

There are two types of Tenancy Agreement terms: Fixed and Month to Month.

A Month to Month agreement is exactly the way it sounds: It is an agreement that continues on from Month to Month until the tenant gives a months notice and moves out.

A Fixed Term agreement is an agreement made between the landlord and tenant for a specified period of time. The most common length of time is a year.

Many landlords prefer the Month to Month lease because they think that it will be easier to evict a tenant. This is false! As long as a tenant is paying rent in your rental property, there are only a small handlful of legal reasons to terminate a Tenancy Agreement.

A fixed term agreement may be more work because you need to give the tenant 3 months notice to renew their lease, but we like the fixed term agreement for the following reasons:

(1) A tenant is more likely to stay the entire year, creating less turnover in your property
(2) If a tenant wants to move mid-agreement, they have to sublet the unit themselves
(3) Most lending institutions require a lease to be in place for funding, and they prefer (some require) a year lease to prove stability within your rental property

Therefore, even though it may be more work to maintain a lease, the long term benefits outweigh the negatives!

Got questions? Email us at
Garamark Property Management is located in Winnipeg, Manitoba and successfully balances protecting the investment of an owner and retaining happy tenants.

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