What is a Condo Lease Agreement?
A condo lease agreement is a legally binding contract between the landlord or owner of the condo and the tenant. A condo lease agreement spells out the obligations and expectations of both parties when they are renting a condo. Since a condo is real property, the Florida Residential Landlord and Tenant Act, Chapter 83 of the Florida Statutes, will govern the lease agreement between a landlord and a tenant of a condo. A condo lease agreement defines what constitutes an acceptable tenant , who is responsible for paying utilities, what damages a tenant is responsible for and how much notice a tenant must provide to the landlord before vacating the premises. It even sets out the grounds for being evicted from the condo. A lease agreement clearly lays out all of these requirements so that the landlord and tenant understand exactly what their obligations are and what is expected of the other. If either party breaches the lease agreement, the other may have recourse to be made whole.
Key Components in a Condo Lease Agreement
Lease Duration: The lease should state the specific length of time for the tenancy, which can range from a few months to several years. Many times, the landlord (lessor) will agree to an automatic renewal of the lease for another year unless either party gives notice.
Rental Payment: The condo lease agreement should indicate the amount of rent due each month, how and when it should be paid, and whether there will be a late fee if the rent is not delivered on time.
Deposit: The lease will often require a security deposit for any unpaid rent or potential damages. The condo lease should provide for the return of the deposit upon cancellation of the lease provided the tenant returns the unit in good condition.
Restrictions: A typical condo lease includes many restrictions on how the unit can be used, such as prohibition of animals, smoking, hanging items on the balconies and interference with other unit owners. The lease may also include restrictions unique to the condo development.
Alterations: The lease can restrict the tenant from making changes in the unit such as painting or wallpapering.
Occupancy: Most leases prohibit subletting the condo unit, which would require the tenant to identify the sub-lettor and seek permission from the landlord.
Condo Rules & Regulations: Most condo lease agreements incorporate the condominium’s rules and regulations as part of the lease agreement and forbid the tenant from violating them.
Importance of Tailoring Lease Agreements
A key aspect of any condo unit lease agreement is its ability to be customized to fit the specific circumstances of a particular leasing arrangement. In certain instances, a standard lease template may not address unique features of certain property or unique needs of the unit owner or tenant. In these situations, a customized lease agreement will provide far superior protection for both unit owners and their tenants. Common examples of this customization are: adding clauses related to balconies or outdoor space servicing, addressing the specific laws of where the unit is located and addressing unique concerns of unit owners or tenants.
It is also important to note that the condo unit lease agreement is a legally enforceable contract between the unit owner and tenant. Not only can it be enforced in the respective circumstances described above, but it can also be privately enforced by the respective parties at the Ontario Small Claims Court under the authority of the Courts of Justice Act.
Common Pitfalls
For both landlords and tenants, missteps more often than not lead to headaches down the road if not immediately. Three of the most common mistakes we see are as follows.
Landlords should always make certain that a prospective tenant is aware of the fact that an application form will be completed so they can be adequately advised. They should also make sure to protect themselves by ensuring that any personal and financial information the tenant provides, as well as references provided by the tenant, are accurate.
It is not uncommon for landlords to indicate the term of the tenancy as "12 months" or "1 year" when neither could in fact be true! Often, the lease agreement will provide that it can be renewed for a further period of "12 months." Subsequently, there are issues with respect to if an accepted offer for rent is valid in law. This leads to further liability on behalf of the landlord in relation to damages.
Investing in legal advice from a qualified legal professional for a condominium lease agreement may help prevent or remedy this unforeseen issue.
Required Legalities and Protections
While there are some basic legal considerations in every lease agreement, such as the need for a written lease, disclosure obligations and habitability requirements, specific legal requirements applicable to a condominium complex and its leased units must be reviewed. For example, the California Davis Stirling Common Interest Act ("Davis-Stirling") governs both the operation and governance of California common interest developments (which include condominiums and planned unit developments) and provides for the rights and responsibilities of the association and individual homeowners.
The governing documents of a community association, such as the CC&Rs, Bylaws and Rules, can further regulate the leasing of units. A common restriction is the amount of time a lessee may occupy a leased unit , and less common requirements may involve the type of restrictions that may be placed on an owner or his/her lessee in order to mitigate the conduct of the occupants of the unit. It is important to note that any restriction on a unit owner’s right to lease his or her unit is subject to statutory provisions limiting restrictions to those deemed to be, among other items, reasonable. Also, restrictions regulating the area of a leased unit that can be occupied by pets should be reviewed because this issue is presently being considered by the California Supreme Court.
If the condominium is a city-designated residential hotel and/or subject to the provisions of the rent control laws (such as the San Francisco Rent Control Ordinance), additional legal requirements must be considered before entering into a lease. Failure of the association or owner to comply with such legal requirements can potentially result in substantial fines, fees, and in some cases open up the owner or association to a private right of action in favor of the tenants.
How to Draft a Sample Condo Lease Agreement
The sample condo lease agreement can be drafted with templates available from various online sources. It begins with the tenant’s current address and then transitions to the current address of the condo unit being rented. The entity that will perform the renting of the unit is then named, whether it be a legitimate business or an individual, as in the case of a condominium board of directors renting out a unit.
The term of the lease follows, listing the exact commencement date of the soon to be effective rental agreement and the precise date the lease is meant to conclude. The amount of rent being charged is then noted along with other important details like whether the rent is due on the first of the month, or if it will be considered late once the clock strikes midnight.
The lease also addresses all the rules under consideration for the pertinent association. The association’s rules are normally attached to the lease, which is indicated in the lease itself. A tenant will not know exactly how much he or she will be required to pay in rent typically, or what additional monetary responsibility might be expected of them because some rental fees are contingent. Water and sewage costs are meant to be covered by the owners of the unit in many cases, but some associations will expect those fees to be assumed by the tenant.
There are additional rules and regulations which a prospective tenant should be expected to follow. For example, smoking inside the unit might be prohibited, as might holding certain parties or performing acts which would generate a high level of noise or potential disturbances. Pets of various types might be outlawed too, such as cats or dogs weighing above 15 pounds.
The security deposit is also a frequent condition of such a lease and the expected conditions for the return of the deposit are described. The process of returning the unit to normal and general condition is also noted in the sample condo lease agreement, making the document vital.
Final Review of an Agreement
The process of finalizing the agreement is relatively straightforward and should be completed prior to the start date of the tenancy. Firstly, read the condo lease from start to finish and note any areas that you would like to discuss or have changed. Items you may wish to consider are the following: – Is the term of the lease reasonable for your personal needs/financial situation? – Are the rent payments breakdowns listed, including date and methods of payment? – Are you satisfied with the rules regarding subletting? – Are the parking provisions acceptable to you, including the fee involved? – Is any personal property included in the rent? – Are the maintenance, responsibilities, repair, and access provisions reasonable to you? – Are the notice periods acceptable to you? – Does the lease include an early termination provision, with or without penalty? – Are the utilities costs both reasonable and acceptable to you? – Does the condo lease meet your expectations? Secondly, complete any specifications or repairs that may be required on commencement of the tenancy within the 14 day time period referenced in the lease and document any such "suitability" issues identified by the Board of Directors or management . Thirdly, set a date for move-in day. Remember that if your moving day falls on a weekend or a holiday, the commencement date will be the next business day. Finally, arrange for the payment of rent and security deposit in accordance with the terms of the lease. If you have concerns or queries about what to do before the condo lease start date, you should consult the condo corporation’s document binder (which will contain all of the documents for your specific condominium corporation). The binders vary from corporation to corporation, but you should be able to find the information in the binder. You may also wish to contact the property manager to obtain clarification and answer any questions you may have, however you will be charged by the condominium corporation for the costs associated with doing so. You may also seek legal advice on the matter. Whichever route you choose, it is recommended that you strongly consider any changes proposed after the lease is drafted. You should discuss any such changes, as well as your concerns and questions with your lawyer before signing.