Leases Flashcards
(29 cards)
Lease
a contract between the lessor (the owner of real estate, also called the landlord) and
the lessee (the tenant) that transfers possession and use of the property, lasts for a specified period, and is made in return for consideration (payment).
Statute of Frauds
requires that leases for more than one year be in writing
to be enforceable.
Reversionary Right
The lessor has a reversionary right to possession of property when a lease expires.
Leasehold Estate Types
- Term of Years
- Periodic Tenancy
- Tenancy at Will
- Tenancy at Sufferance
estate for years (tenancy for years)
continues for a definite period
Holdover Tenancy
may be created when a tenant with an estate for years stays on after the lease
term expires and the landlord accepts rent payment.
Periodic Tenancy
has no specific expiration date,
but rent is payable at definite intervals and the lease term has continuity because it
automatically renews. A month-to-month tenancy is a common form of residential lease
Tenancy/Estate at Will
no specified initial term, is created by express
agreement or operation of law, and can be terminated by the landlord or the tenant at
any time on proper notice.
Tenancy at Sufferance
no specified initial term, is created by express
agreement or operation of law, and can be terminated by the landlord or the tenant at
any time on proper notice.
Valid Lease requires:
CLOAC
Capacity to contract,
Legal objective,
Offer
Acceptance,
Consideration
Fixtures
installed by a tenant generally become the landlord’s property unless they are removable trade fixtures
Reasonable Modifications
Federal fair housing law requires the landlord to allow a tenant with a disability to make reasonable modifications to the premises.
Americans with
Disabilities Act (ADA)
requires that commercial nonresidential property be free of barriers or that reasonable accommodations be provided
Maintenance
typical lease will also include a provision that maintenance of premises will be performed
by the landlord in compliance with state law
Assignment
tenant transfers full lease
Sublease
partial transfer (original tenant remains liable)
requires reasonable consent
Lease Options
may give the tenant the right
to renew the lease, the right to purchase the leased property, or the right of first refusal if the
landlord decides to sell the property
Gross Lease
requires the tenant to pay rent and the landlord to pay the expenses of
ownership, such as taxes, insurance, and maintenance
Net Lease
requires the tenant to pay
rent plus all or most property expenses, with the landlord also paying some property expenses.
Percentage Lease
, the tenant pays rent plus a percentage of gross sales and may pay
property expenses.
Variable Lease
allows an increase in rent during the lease period
Graduated Lease
states specific rent increases
Index Lease
allows rent changes (up or down) based on the
consumer price index or other indicator.
Ground Lease
involves separate ownership of land and buildings
