A lease agreement is a contract with a defined lifespan. As the end of a fixed term approaches, both landlords and tenants face a critical decision: should the tenancy continue? The lease renewal process is more than a simple formality; it’s a negotiation that re-establishes the terms of the relationship for a new period. Understanding the common steps, notice periods, and the distinction between a renewal and an extension is key to navigating this process smoothly and securing a favorable outcome.
Typically, the process begins several months before the current lease expires. The agreement itself often contains a clause specifying the notice period required for renewal, frequently between 60 to 90 days. This gives both parties adequate time to negotiate and make alternative arrangements if an agreement cannot be reached. A landlord may initiate the process by sending a renewal offer to the tenant, which often includes a proposed rent increase based on current market rates. This is the tenant’s opportunity to either accept the new terms or open a negotiation. A tenant with a good payment history and a track record of taking care of the property is in a strong position to negotiate a more modest rent increase.