The landlord-tenant relationship is one that can be positive or one that can be fraught with conflict and disagreement. What’s the different between the two? In many cases, the difference is having a comprehensive lease that covers the right things vs. having an ambiguous lease that is open for interpretation.
Many new real estate investors know how important a lease is to their success, which is why they often wonder how to write a lease agreement that protects the interests of both parties — and that leaves nothing open to interpretation.
At HUNTAHOME, we provide property management in Dallas and Fort Worth, which has given us a great deal of experience in crafting thorough lease agreements that help create positive landlord-tenant relationships. Here’s a look at how to write a lease agreement, what to include, as well as a rundown of who is responsible for different things at a rental property.
What to Include in a Lease Agreement
Creating your own lease agreement can be a challenge. You’ll want to consult a real estate attorney before you consider your lease “final,” but start drafting your lease agreement by addressing the following categories:
- Responsibilities: Be clear about who is responsible for what — the landlord or the tenant (more on this below).
- Names: You need the name of every adult who plans to occupy the rental property. Set a limit on how many consecutive days and nights any guests can stay. Only the adults named on the lease and their minor children have a right to stay without limit.
- Term: How long does the least agreement last? Leases are typically drafted in quarterly increments — 3, 6, 9 or 12 months.
- Rent: How much is total rent per month? Also, include information on when rent is due, how it can be paid, as well as penalties for late payments.
- Deposits and Fees: Outline the amounts due for the initial deposit, any pet deposits, cleaning fees, etc. Also, be clear on what is refundable vs. what is not. For example, the entirety of the initial deposit is typically refundable, while some portion of a pet deposit may be held back for cleaning.
- Access Rights: Landlords typically have broad rights to access the property, but it’s a good idea to include how much notice will be given to tenants before the landlord arrives.
- Restrictions: Make clear that illegal activity can result in termination of the lease agreement. Illegal activity can mean anything from noise violations to drug use or distribution.
- Pets: Also include information on what pets are allowed, if any. Sometimes landlords allow dogs and cats as long as a pet deposit is paid. Other landlords allow only pets under a certain weight. And still other landlords allow no pets at all. That’s for you to decide.
The lease agreement is yours to customize. Start with the categories listed out above, but add any other regulations that you deem necessary or that need to be addressed because of the unique nature of your property.
Landlord vs. Tenant Responsibilities
Conflict in the landlord-tenant relationship typically stems from a misunderstanding around who is responsible for what. To help you get off to the best possible start in your next landlord-tenant relationship, here’s a look at who is typically responsible for what tasks, activities and financial obligations.
The landlord’s responsibilities can be summed up as this: refreshing the property between lease agreements, providing repairs when need, as well as replacing any home fixtures, appliances or systems that are no longer working properly.
More specifically, landlords are typically responsible for the following:
- Significant Repairs: When a foundation cracks, when a roof leaks or when a fence falls over, those are significant repairs that the landlord makes.
- Major System Repairs: A home’s three major systems are its plumbing, electrical and HVAC. Landlords are responsible for ensuring these three systems are working properly.
- Smoke and Fire Safety: A landlord must have installed proper smoke and fire safety devices to ensure a home is up to code.
- Appliance Repair: Landlords provide most home appliances (like dishwashers and washers and dryers in some cases), and it is a landlord’s responsibility to repair them.
- Toxin Control: A landlord must ensure the home is free of mold, lead paint, asbestos or other toxins.
- Pest Control: It’s always smart to have regular pest control visits — quarterly is good. And these visits are the responsibility of the landlord.
- Landscape Maintenance: When trees need trimming or when there are other major landscaping projects, those fall to the landlord.
- Financial Obligations: The landlord pays for the home’s mortgage, taxes, HOA dues and insurance, as well as any home warranty — which it’s a good idea to get to help offset the cost of repairs and replacements.
While the landlord’s responsibilities typically include repairs and replacements, the tenant’s responsibilities revolve around regular maintenance, repairing tenant-incurred damage and reporting anything that would be the landlord’s responsibility.
More specifically, the tenant’s responsibilities include the following:
- Property Damage: Any damage incurred by the tenant is the tenant’s responsibility, including stained carpets, holes in walls, broken windows, etc.
- Waste Management: Tenants must pay for regular garbage collection, and it’s the tenant’s job to make sure waste gets into the garbage cans and that the cans get to the curb.
- Major System Maintenance: The landlord is responsible for major system repairs, but tenants must handle regular maintenance — such as unclogging toilets, changing AC filters, wrapping pipes in frozen weather, etc.
- Smoke and Fire Safety Maintenance: While landlords provide the smoke and fire safety systems, tenants must keep them working. For example, tenants need to change out smoke detector batteries when they chirp — rather than just removing them.
- Appliance Maintenance: Tenants should remove lint from the dryer’s filter, avoid overfilling the dishwasher and clothes washer, as well as anything else that can help keep appliances working properly.
- General Cleaning: While the landlord pays for pest control, tenants must generally keep a home clean and sanitary to avoid pest infestations.
- Regular Lawn Care: Landlords take care of big landscaping tasks, but tenants generally handle the week-to-week lawn care, including mowing, edging, blowing and watering.
- Financial Obligations: Tenants are responsible for monthly bills, including water, electricity, gas, cable and anything else. In some cases, the tenant may need to reimburse the landlord for one of these bills — like if water is paid in bulk for a multi-family property. Also, it’s always a good idea for tenants to have a renter’s insurance policy.
Make Lease Agreements Easy
When a tenant moves in, give them a welcome packet that includes contact information and a copy of the lease agreement. Then walk through the lease with them and talk about who is responsible for different things at the home.
At HUNTAHOME, we handle lease agreements for real estate investors throughout the Dallas and Fort Worth areas. As the leading provider of DFW property management services, we can make your life as a real estate investor so much easier. When you hire HUNTAHOME for property management in Fort Worth or Dallas, you get to sit back and enjoy your cash flow while we take care of the hard stuff.
Get in touch today to learn more about our DFW property management services.