After a lengthy rental application process, knowing that you’ve finally found the right tenant for your property is a big relief. It means that crossing the finishing line is just one step away: drafting and signing the lease agreement.
A solid and comprehensive lease agreement will clearly note both sides' responsibilities, liabilities, and duties, eliminating gray areas and paving the way for a stress-free tenancy. For landlords, the lease is non-negotiable; it ensures their properties are taken good care of and protects their income in case of escalating issues.
Below, we list the 15 most important clauses to include in your lease agreement to protect your properties. Read on to make sure you’ve covered them all in your contract.
Remember that lease clauses for landlords may vary depending on the different state laws, the area you live in, the type of property you're renting, and many other factors. If you have doubts about drafting your lease agreement document, your best option is to talk to a trusted real estate lawyer.
A lease agreement clause is a section or provision within a lease that details the specific terms, conditions, rights, responsibilities, and obligations of landlords and tenants in a rental agreement. These legally binding clauses address various aspects, such as payments, maintenance of the property, and termination, setting clear expectations for both parties from the outset.
Having an in-depth, detailed payments clause will help you avoid gray areas that can lead to headaches down the line. Specify the amount of rent due, due date, payment methods, grace periods, and penalties for late payments.
💡 Pro tip: If the tenant has roommates, include a joint and several liability clause to ensure that total rent is still paid even if one of the parties living at the property cannot cover their part. This also applies to payments for any damage to the property.
If a court determines that a section or part of the contract is inapplicable, a severability clause will ensure that the rest of the agreement remains valid. Having this clause will save time and potential headaches if you enter into a legal dispute with the tenant due to issues with other parts of the agreement.
The security deposit clause is one of the most critical aspects of the lease, as it can often lead to disagreements or back-and-forths between tenants and landlords. Specify the amount of the security deposit, who will hold it, what it will be used for if partly or wholly withheld (for example, to cover property damage or unpaid rent), and the mechanism and timeframe for return at the end of the agreement. Taking the time to make it as detailed and straightforward as possible will pay off when the rental agreement ends. Then, both parties will have clear knowledge and expectations of their rights and responsibilities.
This clause details how and for what the tenant can and cannot use the property. It will clarify whether the tenant can use the property only for residential purposes or also employ it for business. It should also outline prohibited activities at the property and refer to any relevant laws and regulations, such as zoning or noise ordinances and health and safety codes, that tenants must comply with.
While a tenancy is expected to finish on the date stated on the lease, any experienced landlord knows that sometimes life has other ideas, and the agreement needs to end earlier than expected. A solid termination clause will set the conditions under which the parties can end the agreement earlier and specify details, including timeframes, additional fees or penalties, and notice periods.
💡Pro tip: You may need more than one termination clause to cover all your bases when terminating an agreement. Ensure you discuss this in detail with your legal team.
As the end of a tenancy draws near, having clarity on what the next steps are is vital for both tenants and landlords. This is where the renewal clause comes in: it gives the parties the right to extend the lease, specifying the conditions and processes. A comprehensive renewal clause needs to include the notice period for tenants to let landlords know whether they want to extend the agreement or let it expire, what the renewal options are (for example, automatic renewal), the length of the new tenancy period, and any conditions or terms under which the lease can be extended for a new period.
Stating who is responsible for the upkeep and maintenance of the different items and appliances in a property is vital to ensuring things are running smoothly between parties throughout a tenancy. Specify any routine maintenance the tenant needs to carry out (such as changing the HVAC filters) and the frequency. Similarly, list your own responsibilities (for example, plumbing or landscaping) in as much detail as possible and establish the process to file maintenance requests.
💡Pro tip: To avoid things falling through the cracks, make sure maintenance requests are submitted in writing (for example, through email) and not over the phone. This will help you track the work you carry out during a tenancy. It is also an excellent way to have evidence if needed.
This clause gives you (or anyone you specify) access to the property for things such as carrying out maintenance works or inspections. It needs to detail the specific cases in which the landlord or property manager is allowed on the premises, at what times, and how much in advance the tenant needs to be notified of the visit. Standard working hours (roughly between 9 and 5) and at least 24 hours' notice for any visit (except emergencies) are good rules of thumb.
Letting the tenant know in advance whether they are allowed to sublet the property will save you significant headaches in the future. If subletting is permitted, this is the place to clarify its terms and conditions, including to whom they may sublet, for how long, if a security deposit will be taken, and whether this needs your approval. If you don’t want the tenant to sublet the property, failure to mention it in the contract means that you won’t be able to penalize them if it happens.
Alterations to a rental property can frequently be a point of contention between landlords and tenants. Putting in writing exactly what the tenant is or isn’t allowed to do, such as painting or changing light fixtures, is the best way to avoid unpleasant surprises at the end of a tenancy. Be thorough on this point to set expectations at the start of the tenancy and state clearly what needs consent (ideally written) from the landlord to proceed.
Pets can be a source of increased wear and tear and, potentially, damage, so it’s important to consider carefully the conditions and policies to allow them in your property. The pet policy clause needs to leave no room for discussion: include what animals (if any) are permitted, or what breeds, if there’s an additional fee the tenant needs to pay, or if the security deposit needs to be higher to cover any issues stemming from pets in the property. Conducting pet screening can also be a good idea to be extra careful.
Indoor cigarette smoking can lead to expensive property damage, so it’s in your best interest to include a no-smoking clause in your lease agreement. Installing a cigarette smoke detection device like Minut (and mentioning its presence in this clause) will help you ensure that smoking rules are being followed and alerts you when they are not. Alternatively, you can limit where tenants are allowed to smoke, for example, on balconies or terraces. Just detail the designated areas where this can be done and include any additional cleaning fees or penalties if the tenant smokes elsewhere.
In most cases, paying utilities and services is the tenant’s responsibility (unless they are already included in the rent). However, shared utilities, such as a central heating unit, may be governed by specific local laws or regulations, so make sure you check what you can and can’t bill your tenant for.
As a landlord, ensuring your tenants are not disturbing neighbors is essential to keeping things running smoothly, especially when you want to continue renting out your property with no problems. Including a noise and disturbances clause in the lease will help you set up a ‘quiet hours’ rule and ban or restrict loud music and parties, helping you to minimize complaints from other residents. And while you cannot dictate your tenants’ lifestyle choices, you can use smart tech such as Minut to enforce noise rules while protecting your tenants’ privacy.
Minut alerts you to excessive noise and sends tenants automated messages to bring the volume down, helping to de-escalate potential issues instantly. If you use a solution like Minut to monitor noise levels, mention it in the noise and disturbances clause so tenants are aware of its presence and understand how it works.
When moving out, tenants are expected to leave the property in the same condition as they found it when they moved in. A cleaning clause on the lease will help you avoid unpleasant surprises at the end of the tenancy. It will also mean the property is in good shape for viewings or for new tenants to move in.
This section needs to clearly detail the outgoing tenants’ cleaning responsibilities, explaining whether they are in charge of any communal or outside areas, too, and state any penalties if they fail to return the property in the expected condition.
Whether renting out a single unit or a dozen, you want to make every rental term as stress-free as possible and have the peace of mind that your properties are being looked after. A detailed and exhaustive lease agreement, covering everything from termination to noise disturbances, will help you protect your property and income and ensure the relationship with your tenants runs smoothly.
Minut can help you look after your long-term rental property. Book a demo today to learn how.
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