Can You Renew a Lease in Florida?
Are you an accidental landlord dealing with your first renewal? Are you curious how to handle your tenants lease renewal?
Statistics reveal that tenants are renewing leases at record levels.
- In the second quarter of 2020, 57.4% of renters renewed their leases.
- In the third quarter of 2021, this increased to 57.6%.
- By the first quarter of 2022, the renewal rate rose again to 58.3%.
We expect even higher rates to come out of 2024.
As a property owner, retaining responsible tenants is crucial. Tenant retention is key, and it's important to handle lease renewals correctly to avoid any issues. Have you considered the process of renewing a lease?
Here are some important details to consider:
Considerations For Renewing a Lease
Finding new tenants takes time, so renewing with your current tenant may be easier. However, only continue a lease with a tenant who takes care of your property, pays on time, and respects their neighbors.
Keeping a mediocre tenant who damages the property and pays rent late will cause more stress than finding a new tenant.
Should You Increase Rent?
The next consideration is whether to increase the rent. This decision could impact whether a tenant will stay. You might need to offset annual expenses, but this could mean losing your tenant. Determine if the rental increase is worth the potential vacancy.
If you decide to increase the rent, you must provide a notice of rent increase. Notify your tenant of the increase as soon as possible. This gives them the information needed to decide whether to stay, opening the door for rent negotiation.
When to Offer the Rental Lease Renewal
You should offer your tenant a new lease 90 days before the current lease expires. You can do this via email, a lease renewal letter, or in person. Having a strong lease renewal process is important.
Your goal is to get a reply from the tenant within 30 days. This gives you at least 60 days to find a new tenant if needed.
How to Make the Offer
Electronic delivery, including emails, is the most efficient form of communication. Your message must include all the details, such as the current lease’s expiration date and the new terms.
Additionally, include the offered rental price. If the tenant agrees, you will need to draft a new agreement.
Month-to-Month Renewal
Some tenants prefer to stay for a shorter period than an annual lease. They may request a month-to-month, meaning the lease continues on a monthly basis.
In these leases, either the landlord or the tenant can end the lease with sufficient notice. Consider the pros and cons of a month-to-month agreement.
The renewal lease must specify the required notice period, typically 30 days.
Even a month-to-month lease requires a signed agreement from both parties. You can also consider extending the lease agreement.
What to Know About Renewing a Lease
It's easier and cheaper to keep a good tenant than to find a new one. To retain tenants, aim to keep them satisfied.
This involves managing the process professionally while protecting your rights as a landlord. Retaining tenants in their leases is key to reducing vacancies. Professional property managers and landlords use attorney-prepared leases.
Lease Renewals in Central Florida
