Top 3 Important Factors to Consider in a Lease Renewal

It's estimated that 65% of San Francisco households rent their homes. Thanks to the pandemic eviction moratorium, renting is now more attractive.

Yet as a landlord, you still want to maintain some control. Being able to handle leases, both new and existing, is one way to work with good tenants. This gives you a stable income and fewer headaches.

Both federal and local laws affect how lease renewal works across the country. They'll impact what you can—and can't—do.

Read on for three factors you should consider when it comes to lease renewal.

1. Know the Legalities of Lease Renewal

In California, apartment leases roll over to a month-to-month lease when they reach the end of their term. They don't automatically renew.

If the building was built before June 1979, month-to-month tenants are protected by rent control.

Single-family homes and condos are a different matter. Tenants in those properties who moved in after January 1, 1996, aren't covered by rent control.

They do still have tenant rights, which affect how lease renewing works.

These legalities differ in other states, so check where you stand before you renew a lease.

2. You Need a Just Cause to End a Lease

Thanks to Californian rental protections, you need "just cause" to evict tenants in San Francisco. You can't simply let the lease end and ask them to leave.

Examples of a just cause include:

• Needing to renovate the property
• Non-payment of rent
• Illegal use of the property

Without a just cause to evict, the expired lease will roll over. There are 16 accepted just causes. If you do want to end a lease, rather than renew it, make sure you check these causes first.

3. It's a Good Idea to Keep Good Tenants

The biggest tips for renewing your lease come down to how good your tenants are. Keeping tenants in your properties is an easy way to ensure you have a steady and predictable income stream.

Ask yourself these questions:

• Do your tenants pay on time?
• Do they care for the property?
• Have neighbors ever complained about them?

Are your answers yes, yes, and no, in that order? You'd be well-placed to renew the lease to keep your tenants in the property. Renewing the lease gives you more security than a month-to-month contract.

Tenant screening is also a good way to ensure you only let properties to good tenants.

Make the Lease Renewal Process Easy

Outside of San Francisco, lease renewal is an easier process. You choose if you want to keep your tenants or let the lease expire and watch them leave.

California operates under different laws, particularly in San Francisco. You need to be aware of these when the lease is about to run out. 

If you're unsure of the lease renewal process, don't worry. You can work with our San Fransisco Bay property managers to get it right.

They can also help you with other landlord responsibilities to make sure your properties run smoothly. Contact Kenny Realty Sales & Property Management for more details.