Guide to Drafting a Solid Lease Agreement for Your Rental Property

A lease agreement is a legally binding document that establishes, sustains, and terminates the relationship between a tenant and the landlord.

Within the agreement, the obligations and responsibilities of each party must be explicitly expressed to there is no room for doubt.

A solid lease agreement touches on responsibilities, clauses, policies, and disclosures. In addition, it must also adhere to the provisions set by local, state, and federal law.

What else should a solid lease agreement contain?

In this article, we at Pillar Property Management set out to describe what each landlord should know about writing a solid lease.

Drafting a Lease

approved lease

First-time landlords tend to use downloadable templates and flesh them out with details. While it seems like a shorter option, most templates offered are simply skeletons, so you would be required draft complete the lease.

There are others who use specific property lawyers which significantly cuts down on research and ensures that your property complies with the provisions of the law.

Another option is to use a reputable property management company. Their experience, industry knowledge, and expertise would help to protect both you as a landlord, and your tenants.

Needing a Lease Agreement

Most jurisdictions, including our own, legally require a formal contractual agreement in writing that binds the landlord-tenant relationship.

This is because, if a tenancy issue ever finds itself in a court of law, the court will always reference the lease agreement. So, it is always advisable to draft a solid lease agreement over any other agreement type.

Elements of Every Lease

A lease agreement should be drafted with the specific individual clauses to handle the needs and wants of your tenants. But certain elements can be found in every lease agreement.

Who and Where

The official names of the tenant(s) and the landlord must be used in the lease agreement. Their address and contact information must also be included.

Since the contract references the property, the property address must also be on the lease agreement. If the property in question is an apartment unit, the lease agreement will specify the door number also.

Rent

rental property sign

The lease agreement must be specific on the amount and date of the month on which rent is due. From our experience in the Winnipeg area, we recommend that all numbers written be in both figures and words to prevent any confusion.

If there are other fees to be collected, e.g., security deposit, utilities or pet deposits, they should be specified separately, and their due dates provided – even if they are the same as each other.

Term of the Lease

Be specific when referencing the term length in the rental agreement. Clearly state when term starts and when it ends. For example: from 15th September 2020 to 14th October 2020.

The Parties Signatures

Both parties need to add their signatures to the document. This binds the parties to the terms, obligations, and responsibilities outlined in the lease agreement.

Important Policies or Clauses

Leasing agreements tend to differ when it comes to specific clauses and policies. These are at the discretion of the landlord whether they should be kept or discarded. There is also compliance with the law to consider.

If you have any questions regarding these clauses, please contact us at Pillar Property Management and we can help you understand the State Law of Landlord and Tenant rules.

Subletting Policy

Subletting gives the tenant the control to further rent out the space and pocket a share of the rental payment. It is a good idea to make it clear whether subletting is permitted and if it is, what the terms of the sublet are.

Access Policy

While you are the property owner, the tenant(s) have a right to privacy and to enjoy the space without undue interruption or just cause. This is known as the right to quiet enjoyment of property.

To gain access, landlords and their agents are required to provide notice to the tenant within a specific period before entry, so it is a good idea to add this to the lease agreement.

Tenants Obligations

While landlords are obligated to perform certain obligations, the tenant also has obligations to fulfill. These should be clearly stipulated within the agreement.

Once the agreement is signed; any violation is grounds for termination of the lease. However, there are circumstances where it is justified under the Law. For example, if the tenant has an active military duty.

Bottom Line

Drafting a comprehensive leasing agreement is critical to the success of your rental property. Not only is this a legal obligation, but it is a best practice for both you and your tenant. It clearly sets what you expect of your tenant and what your tenant will expect of you.

Pillar Property Management is a leading property management service in Winnipeg, Manitoba. Our wealth of experience puts us in the best position to draft a solid lease agreement on your behalf that will keep both you and your tenants as safe as possible.

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