Pros and Cons of Month-to-Month Rental Agreement

by Remy Lacanaria

Posted on 2019-09-03 20:17:01


 Pros and Cons of Month to Month Rental Agreement.PNG



What is a month-to-month rental agreement? As the name of this agreement says, it is the type that is renewed on a monthly basis and doesn't contain specific time limits. The tenancy continues until one party or the other issues a notice to terminate tenancy 30 days written notice given before the rent is due. Rent control cities do not allow and requires the landlord to prove a legally recognized reason for eviction. It is also known as "tenancy at will".

There are 3 types of a rental agreement, the month-to-month rental agreements, one-way leases, and the fixed-term leases. Here we will discuss the month-to-month rental agreement and the pros and cons of it.


  • Flexible End Dates. Since there is no fixed end date, the tenant can stay at the property for as long as both tenant and landlord agree. To end a month-to-month agreement, tenants may just have to provide the landlord with a proper amount of written notice.
  • No Penalty to end the lease. A month-to-month lease agreement doesn't have a specific date of ending the lease, hence, a month-to-month lease agreement with tenants will not face a penalty for breaking the lease early. To properly end a month-to-month lease agreement, the tenant must provide landlord an appropriate amount of written notice to move out. 
  • Update the Rent Price. If it's a month-to-month rental agreement, landlords can legally update the rent price by giving the tenant a proper amount of notice. In most states, it's 30 days.
  • Short term rent. One of the benefits that a month-to-month gives to tenants is having a temporary place to live while their house is under renovation or while looking for a brand new house to buy. 
  • No need to deal with problem tenants longer. One of the advantages of a month-to-month lease, when you have a problem tenant in the property, is that you don't have to deal with them longer. Landlords may provide a Non-Renewal of Lease to tenants, this is to inform the tenant that the current rental agreement which is the month-to-month lease will not be renewed at the end of the lease term.
  • Can attract more tenants. There are tenants who only need a short term or couple of months place to live like students, and there are also employees who were just assigned to work in a certain place for a month or so. They may both prefer to have a monthly agreement.


  • Expect Higher Rental Fee. Some landlords charge tenants with higher rent compared to a yearly lease agreement. It allows them to charge more of rent each month because tenants have the flexibility to move out quickly. It helps landlords offset the value of the anticipated vacancy.
  • Expect a higher chance of vacancy. As mentioned above, there is no specific end date for a month-to-month rental agreement, tenants come and go. So if landlords allow a month-to-month lease agreement, you should always be prepared for a vacancy on your property.
  • Potential for lower quality tenants. Since landlords have a month-to-month lease agreement, landlords can expect a higher chance of dealing with frequent noise complaints, maintenance complaints or damage to the property.
  • Less stable. Since tenants of a month-to-month lease just want a short term place to live, landlord's rent income will not stable.



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