2,3, yr vs 1 yr lease… Never lease for 12 months

With 15 yrs experience, about 5 years ago I refused to accept 1 yr leases. Why? People who sign 1 yr leases tend to be more transient, ruin properties, and vacancy is expensive. It's interesting - bit now my average tenant stays over 4 years- I never increase rent- but hey ( vacancy is expensive) and longer term renters tend to require less repairs. Multiple generalizations here- wanted to see if your experience is similar. I tell new investors to never sign a lease under 24 months. This is one of only a few proprty management issues I feel strongly about.

Do you notice that not raising...

Do you notice that not raising the rent makes a noticible difference in the longevity of your tenants? I keep rent-raising pretty low each year, but I think I'd rather have the same tenants (at least the good ones) there for years and not increase the rent than to have to fumble around for a new tenant every year or two.

I agree 100%. My units in whic...

I agree 100%. My units in which has not been raised for 12 years and no turnover and 200-300 short of market rent. Are more profitable than units collecting market rent with turnover every 24 months.

I am with you on this. a good ...

I am with you on this. a good tenant is better than a few hundred dollars of extra rent any day.

also agree. Never have raised ...

also agree. Never have raised rent on a renewal. But I am in DC area which is pretty transient so I would typically only get a lease longer than twelve months if I gave them an out. Only had one tenant exceed 24 months.

location location location

Depends on your location and demographics. Two year leases would probably be the max for me. I like the flexibility of a 1yr lease. I always raise rent, not much but a few dollars. My area is a transient area where home prices are low people can afford to buy for less than rent after they clear up credit issues.

I start with a 1 year lease be...

I start with a 1 year lease because rental properties are a two way street. A problem tenant has a lot of legal rights and I'd rather be stuck with one for 1 year than 2 right off the bat. You can screen all you want, but the bottom line is you really never know what you have until they move in and they start paying their rent. After the first year if the tenant has earned it we give them the option of a two year lease, we give them an option because we give them a choice of a one year or a two year lease with the two year lease having less of an increase in rent. Notice there is a rate increase after the first year. I always raise the rent on every lease renewal, I don't go crazy, maybe it's only $10 or $20 a month, but you need to have an increase, you need to get your tenants used to the fact that things go up every year due to increases in cost and inflation. I've never lost a tenant over a rent increase and our average tenant has been with us for about 5 years.

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