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Intermediate terms

Essential Leasing & Tenant Relations Terms

This curated collection includes key terms that might be helpful when exploring leasing and tenant relations in real estate. It covers foundational concepts, legal aspects, and operational considerations for managing rental properties. These terms were selected based on common questions and areas where investors often need clarity.

Learning Path

1

Lease Agreement

A legally binding contract between a landlord and a tenant that outlines the terms and conditions of renting a property, including rent, duration, and responsibilities.

Beginner18-20 min
2

Lease Commencement Date

The Lease Commencement Date is the official date specified in a lease agreement when the tenant's rights and obligations, including rent payments and property responsibilities, legally begin.

Beginner13-14 min
3

Lease Expiration Date

The lease expiration date is the specific day a rental agreement legally ends, requiring tenants to vacate or renew, and allowing landlords to adjust terms or seek new occupants.

Beginner15-18 min
4

Constructive Eviction

A legal doctrine allowing a tenant to terminate a lease and vacate a property without liability for future rent, due to a landlord's actions or inactions that render the premises uninhabitable or unsuitable for its intended purpose, breaching the covenant of quiet enjoyment.

Advanced15-18 min
5

Rent Escalation Clause

A rent escalation clause is a lease provision that mandates periodic increases in the base rent over the term of the lease, typically to account for inflation or rising operating costs.

Intermediate13-14 min
6

Fair Housing Act

The Fair Housing Act is a federal law prohibiting discrimination in the sale, rental, and financing of housing based on race, color, religion, sex, national origin, familial status, and disability.

Intermediate12-13 min
7

Fair Market Rent

Fair Market Rent (FMR) is an estimate of what a rental property would lease for on the open market, including utilities, as determined annually by the U.S. Department of Housing and Urban Development (HUD) for various housing programs.

Intermediate13-14 min
8

Common Area Maintenance

Common Area Maintenance (CAM) refers to the costs associated with operating and maintaining shared areas in a commercial property, which are typically passed through to tenants as part of their lease agreements.

Intermediate13-14 min
9

Tenant Screening

Tenant screening is the process landlords use to evaluate potential renters, assessing their reliability, financial stability, and past rental behavior to minimize risks and ensure a good fit for the property.

Beginner15-18 min
10

Vacancy Rate

The vacancy rate is the percentage of all available rental units in a property or market that are currently unoccupied or not generating income, serving as a key indicator of a property's financial health and market demand.

Beginner13-14 min
11

Tenant Default

Tenant default occurs when a tenant fails to uphold the terms of their lease agreement, such as non-payment of rent, property damage, or other lease violations, requiring landlords to follow specific legal procedures to resolve the breach.

Intermediate12-13 min
12

Rent Roll

A rent roll is a comprehensive document detailing a property's rental income, occupancy, and lease terms for each unit, essential for financial analysis and property management.

Intermediate15-18 min
13

Tenant Improvement

Tenant Improvement (TI) refers to modifications made to a commercial space to customize it for a tenant's specific needs, often funded in part by a Tenant Improvement Allowance (TIA) from the landlord.

Intermediate15-18 min
14

Eviction

Eviction is the legal process by which a landlord removes a tenant from a rental property due to a breach of the lease agreement, such as non-payment of rent or other violations, strictly adhering to state and local laws.

Intermediate12-13 min
15

Tenant Retention

Tenant retention refers to the strategies and efforts property owners and managers use to encourage existing tenants to renew their leases, minimizing vacancies and turnover costs.

Intermediate10-11 min
16

Lease Term

The lease term is the specific duration or length of time, defined in a lease agreement, for which a tenant agrees to rent a property from a landlord.

Beginner14-15 min
17

Notice to Pay Rent or Quit

A formal legal document issued by a landlord to a tenant demanding payment of overdue rent within a specified period or vacating the property, serving as the first step in the eviction process for non-payment.

Intermediate14-15 min
18

Rent Control

Rent control refers to government-imposed limits on the amount landlords can charge for rent and the rate at which rents can be increased, typically enacted to promote housing affordability.

Intermediate13-14 min
19

Lease Renewal

Lease renewal is the process where a landlord and tenant agree to extend an existing lease agreement beyond its original term, often involving new terms like rent adjustments.

Intermediate13-14 min
20

Property Management

Property management is the professional oversight and operation of real estate, typically rental properties, on behalf of an owner, handling tasks from tenant acquisition to maintenance and financial reporting.

Beginner11-12 min
21

Warranty of Habitability

The Warranty of Habitability is an implied legal guarantee that residential rental properties must be fit for human habitation, requiring landlords to provide and maintain safe, sanitary, and structurally sound living conditions.

Intermediate13-14 min
22

Estoppel Certificate

A legally binding document signed by a tenant that certifies the current status, terms, and conditions of their lease agreement, providing critical verification for real estate buyers and lenders.

Advanced14-15 min
23

Notice to Vacate

A formal written statement from a landlord to a tenant, or vice versa, indicating the intention to terminate a lease agreement and vacate the property by a specific date, adhering to legal requirements.

Beginner15-18 min
24

Unlawful Detainer

Unlawful detainer is a specialized legal action initiated by a landlord to regain possession of real property from a tenant or occupant who is wrongfully withholding it, typically due to lease violations or non-payment of rent.

Advanced15-18 min
25

Triple Net Lease

A Triple Net Lease (NNN) is a commercial real estate lease where the tenant pays base rent plus property taxes, building insurance, and common area maintenance, making it a highly passive investment for landlords.

Intermediate15-18 min
26

Security Deposit

A security deposit is a refundable sum of money collected by a landlord from a tenant at the start of a lease to cover potential damages, unpaid rent, or other lease violations.

Beginner13-14 min
27

Covenant of Quiet Enjoyment

The Covenant of Quiet Enjoyment is an implied right in a lease agreement assuring a tenant undisturbed use and possession of a property without interference from the landlord or their agents.

Intermediate14-15 min