Guess what? You don’t have to commit to a 12-month lease agreement. The length of your lease can be whatever you want it to be, and while 12 months is typically a standard length, there are good reasons why you may not always want yours to be.
Modifying Your Lease Length Can Be Good for Your Vacancy Rate
Navigating the rental market requires strategic timing, especially when it comes to lease agreements. While 12 months is an easy round number for a lease length, if those 12 months end during the slow season, you may want to modify yours.
Here in Franklin County, the slow season starts in late October and runs through the New Year. The fewer vacancies you can have during this time of year, the better because filling those vacancies typically takes longer in the winter. No one wants to pack up in the cold, and people are distracted by the busy holiday season.
To prevent a slow-season slowdown, do what you can during that initial lease agreement to avoid ending the lease during the slow-season months.
For example, you can set your lease to be 9 months or 16 months or whatever makes sense for your property and market conditions. Our team at RL Property Management frequently develops lease agreements of varying lengths so that when that lease comes up for renewal, it’s not a bad time of year if the resident decides not to renew. It’s far easier to secure a new tenant in the spring or summer than in the middle of winter.
Think Outside the Box to Incent Residents
In addition to modifying your lease length so it ends during peak rental months, you might also consider creating a two- or even three-year lease agreement and offer incentives for a resident to sign a lengthier agreement. Not only does this help you avoid low-season vacancies, but it also increases your overall vacancy rate by extending the length of time a current resident is in your property. As we’ve discussed before, there is inherent value in retaining existing tenants.
If you choose to offer an extended lease agreement, don’t feel committed to one pricing strategy. You may even offer the resident options. For example, a one-year lease might cost so much, but a two-year lease would bring it down to this. Or, the discount might be that you’re not going to raise rent during the duration of their current lease agreement.
The bottom line is you have options as a property owner and can play around with lease lengths to minimize your vacancies during the slow season, which is when it is generally harder to fill units. If you need help or have questions about the Columbus rental market, contact our team at RL Property Management.
