Month-to-month leases offer both upsides and downsides to prospective renters. The biggest benefit is flexibility: instead of committing to a 12-month lease, you can move out as long as you give your landlord sufficient notice. But that flexibility extends to landlords as well. Without a 12-month lease in place, they often have broad power to end the agreement on short notice.
Read on to learn more about the pros and cons of month-to-month leases.
The Pros of Month-to-Month Leases
More Flexibility
As mentioned above, month-to-month leases don’t require a long-term commitment. Instead, the lease agreement is limited to a single month, but it automatically renews for each subsequent month until you or the landlord take action.
As a result, you are usually free to move out at your leisure, so long as you give the landlord an appropriate amount of notice. The amount of notice you need to provide can vary by landlord and location. In some cases, state laws set the maximum amount required, though that isn’t universally the case. However, most fall in the 20-to-30-day range, though there are some that may make 60 or 90 days’ notice mandatory.
Still, as long as you abide by the terms, you can leave whenever you want without facing penalties. That can make month-to-month leases a solid choice for anyone who isn’t sure how long they’ll remain in a unit, providing they’re prepared to give the needed notice.
Makes Roommate Arrangements Less Daunting
If you’re splitting the cost of an apartment with a roommate, month-to-month leases can make that less daunting from a financial perspective. For example, if you can’t afford the unit on your own and a roommate unexpectedly bails, you don’t have to figure out how you’ll cover it until the lease expires.
Plus, you aren’t stuck breaking a 12-month lease, which can come with financial penalties. Rushing to find a new roommate – which can be challenging in some cases – also isn’t a necessity.
Instead, you can simply provide the landlord with notice and prepare to move out. That allows you to leave behind a monthly expense that you can’t cover alone by finding another rental that fits into your budget.
Similarly, if you have a sudden need to move out of the unit, you aren’t leaving a roommate stuck with a monthly housing payment they can’t cover. While you want to give ample notice, they would then have the option of staying or leaving after the required time passes, ensuring they aren’t chained to a financial obligation because you chose to move out.
Fully Furnished Units Might Be Available
Generally speaking, units that have month-to-month leases are more likely to be fully furnished than those that come with longer terms. In this case, the apartment is essentially designed with short-term renters in mind. For example, they may target business travelers who are staying in the area long enough to make paying for a hotel too cumbersome, serving as an alternative.
However, that means that apartments with month-to-month leases can also work well for many other people. For instance, if you’re moving out of your family home for the first time, you can start living on your own and still have all of the furniture you need.
Whatever your circumstances, do make sure to take care of any provided furnishings while you’re there. Otherwise, damage beyond wear and tear could result in some additional costs.
Try Before You Commit
Some landlords are open to both month-to-month leases and longer-term agreements. In this case, starting with a month-to-month lease allows you to try the unit before you commit to a full 12 months in the apartment. It lets you learn the things you can’t find out from a simple tour before moving into the unit. For example, you can gauge the landlord’s responsiveness to issues, the quality of the neighborhood, whether a commute is convenient enough, and more.
After trying out the apartment, you can speak to your landlord about transitioning from a month-to-month lease to a longer-term option. Not only will you be confident about your choice of apartments, but it also allows you to set certain aspects of the agreement in stone for longer, allowing you to predict your rent for the next year and other features of the arrangement.
Troublesome Neighbors May Disappear Fast
Dealing with a difficult neighbor is challenging for anyone. However, if you’re in a building that relies on month-to-month leases, it might not be as much of an issue overall.
Getting a troublesome tenant out of a unit covered by a long-term lease can be difficult. Even if the landlord has just cause, it can lead to a surprisingly lengthy legal battle if the tenants don’t agree to leave at the landlord’s request. In some cases, tenants that are being evicted may also become hostile, which can be difficult for you if their resulting actions impact your quality of life or peace of mind while in your unit.
However, if your landlord uses month-to-month leases for the units in your building, that could mean that troublesome neighbors won’t stick around for long. Since there isn’t a long-term commitment on the part of the tenant or landlord, landlords have the ability to ask tenants they have issues with to move out reasonably quickly. As long as they provide ample notice, that’s all that’s required in most cases, allowing them to restore peace to the building with surprising speed.
The Cons of Month-to-Month Leases
Landlords Can Change the Arrangement Quickly
While month-to-month leases give you more flexibility, it also gives landlords the ability to terminate the leases at their discretion. While they do have to provide notice – the amount of which varies by state or per your agreement – you may get as little as 30 days to find a new place and move out.
Additionally, since the lease technically renews every month, it gives the landlord to change the terms before each renewal occurs. That could cause a once affordable unit to become cumbersome to handle. While you would have the option of moving out should that become the case, it similarly results in very little time to make that happen.
Higher Cost
While not universally true, month-to-month leases can cost more than rental agreements that come with a longer term. In many cases, 12-month leases provide landlords with a sense of financial stability, as they know the unit will remain occupied or that an early exit can trigger fees that offset some of their losses.
With a month-to-month lease, landlords never know if a tenant is going to remain from one month to the next. As a result, they often increase the price to compensate for potential financial inconveniences that can result from a quick exit. For example, they may have to find a new tenant without much prior notice, as well as shoulder advertising costs related to marketing the unit more often.
Less Room for Your Stuff
As mentioned above, some units with month-to-month leases come fully furnished. While this is a boon if you’re staying short-term and don’t have a need to purchase your own furniture, it can also mean being stuck with what’s provided.
Depending on what’s there, that may limit the amount of space you have for belongings of your own, especially when it comes to big furniture pieces. As a result, you might not be able to buy furniture for your next apartment, suggesting you plan on finding something unfurnished the next time around.
While some landlords may remove pieces they provide at your request, not all will. Additionally, even if putting the items in storage is an option for the landlord, some landlords may charge tenants if doing so leads to an additional cost for them.
Less Stability
In some cases, sticking with month-to-month leases leads to feelings of instability. Even if your landlord doesn’t take any actions that make you think they’ll ask you to move out, the fact that they can may hang over your head.
Additionally, since the terms can change quickly and frequently, that can make financial planning difficult. For some, that sense of instability may make month-to-month leases a poor choice for their mental and emotional health, even if the landlord doesn’t take advantage of any of their available options.
More Troublesome Neighbors
At times, landlords that use month-to-month leases aren’t as stringent about tenant screening as landlords that rely on longer-term agreements. Primarily, this is because there’s less perceived risk, as tenants can be asked to move out at any time.
While this does mean landlords may take a chance on a down-on-their-luck person who deserves another shot, it can also increase the likelihood of troublesome neighbors. Less screening means that some tenants who would typically get screened out due to past poor behavior make it into a unit. Even if they don’t stay long, it’s disruptive, and if it occurs repeatedly, it can make life miserable for you.
Should You Sign a Month-to-Month Lease?
Whether month-to-month leases are right for you depend on your needs and preferences. They’re excellent options if you need flexibility, as you aren’t stuck with a long-term commitment. However, you do need to be comfortable with the potential drawbacks, too, so make sure you take them into consideration before you sign on the dotted line.
