When it Makes Sense to Sign a Month-to-Month Lease
In the world of renting, there are a lot of different standards in terms of leasing arrangements, one of which is the month-to-month lease.
While not right for everyone, a month-to-month lease has some specific benefits. If you think it might be right for you, check out the following for our insider knowledge on this type of agreement.
What exactly is a month-to-month lease?
Typically, landlords and property managers require residents to sign a lease agreement. This agreement guarantees that the tenant will reside in in the unit for a predetermined amount of time – usually 12 months.
However, lease agreements can be as short as three months or as long as two years.
A month-to-month lease ensures tenancy for the upcoming thirty days. The lease is renewed every month allowing for quick changes in residency. Typically, all that’s needed to leave a month-to-month lease is a 30-day notice at the tenant’s discretion.
They’re harder to come by and you’ll likely pay more than you would under a traditional lease, but in some situations, it’s worth it.
When you aren’t sure about your immediate future
If you’re not sure where you’ll be in a month, then a month-to-month lease might be in your best interest. Recent graduates, newlyweds or job seekers often need temporary housing while they search for something more permanent.
Or maybe you’re in the middle of a transition but you already know where you’ll be living eventually. If you’ll be renting a unit that isn’t quite ready in a newly-constructed apartment building or have just a few months before you make a big transfer at work, this would be a helpful option, as well.
They’re also a great option if you’re new to a city. Moving to a new place can be overwhelming, especially if you’ve never been there before. A month-to-month lease is a great option to give yourself time to learn the area, decide where you want to live and how much you can really afford to spend.
When your future plans are only temporary
There are some who know exactly what they’ll be doing – but only for the next couple of months. Traveling nurses are sent to a city for a short period of time when there’s a shortage and they can’t sign a lease for a year. They’ll be sent somewhere else long before that year is up. The same can be said for volunteers who go to work a disaster hit area or a member of the media who will be in an area covering a story that might take a while to research.
And then there are the lucky ones who can take an extended vacation or sabbatical from their daily lives. They may choose to spend their time off in a different city, but they know it won’t last forever. It would be much more cost effective to find a short-term rental than spend all their money in a hotel.
When you aren’t sure about a roommate's future plans
Roommates are great for taking on some of the burden of paying rent each month. That being said, no matter how much you think you know about your roommate ahead of time, they can always surprise you.
To avoid getting stuck with 100 percent of the rent when you’re used to paying a half, a third or even less, try to find an apartment where you can take on a month-to-month lease. This lets the whole house live their lives freely without being tied down by a long-term lease.
When you have a flexible budget
One of the starkest differences between a traditional lease and a month-to-month lease is the ability of the landlord to respond to changes in your local market. If the market shifts, your rent may increase from one month to another.
Since you’re technically placed under a new agreement at the beginning of each month, your landlord can change the terms of the agreement at their discretion. The caveat is that you’re never required to sign it. If your landlord or property manager begins taking advantage of you, you always have the option to find a rental elsewhere.