multiple year lease?
Has anyone ever heard of people buying a multiple year lease (like 10 years) on an apartment up front? Sounds weird to me, just wondering if anyone had ANY examples of this ever.
Has anyone ever heard of people buying a multiple year lease (like 10 years) on an apartment up front? Sounds weird to me, just wondering if anyone had ANY examples of this ever.
RAR, sounds like monkey business to me! Be careful!
Echoing what Vinca said, about multiple-year leases going for commercial spaces. Never heard of it for residential.
“Hey me here, I mean something even weirder, that the tenant would pay in a lump sum up front in exchange for a large discount over time.
Posted by: RAR at May 27, 2009 2:20 PM”
That’s even more insane in my opinion. All the previously described issues aside you’d have to come up with a ton of cash to lay out. Why not leave it in your account and gain interest on it? Or, if you have that kind of cash buy something…
Figure $2k a month (after discount, say a $3k a month place normally). Without yearly increases you are looking at $240,000! You’d want to write a check for $240,000, minimum, for a 10 year lease on an apartment? Why?
Maybe lump sum for 1 year, 2 possibly, but 10? Why? Wouldn’t that money do better for you in a 1% interest savings account?
Hey me here, I mean something even weirder, that the tenant would pay in a lump sum up front in exchange for a large discount over time.
I wouldn’t want to do this from either as a new tenant because all $$ issues aside, you have not had real interactions with the landlord yet. What if he sucks, doesn’t maintain the apartment to your standards, or in a timely manner. What if your neighbor is a drug-dealer/garbage hoarder/a-hole/party animal and the easiest course is just to move. Do you want to spend months worth of time in housing court arguing about your living conditions for the next 10 years? Or be sued for breach of contract if you can’t take it anymore and move in year 5? Makes no sense to me.
Similarly if I were a landlord, I am going to be cautious that you are a PITA who will constantly harrass me about dumb stuff, or sell drugs from the apartment, or you’re filthy and breeding cockroaches, and my easiest course of action is just to let the lease expire at year-end rather than spend months in housing court trying to evict you.
Not sure why anyone entering a new rental relationship would want to start with such a long lease.
Bunkerlabs has a good point about not getting forced out, but the opposite is what I would worry about…
… if the area takes a downward turn and rents plummet you might be locked in to a lease with steady increases in a neighborhood where rents are doing the opposite. And if you want to leave you might not be able to get out of the lease or find someone willing to take it over…
just food for thought…
This used to be something that happened a lot in Dumbo/wburg where it was in the interest of the landlord to have someone locked into the place. I wouldn’t buy the privilage but if you like the place a lot you can negotiate a std. rent increase per year and have some measure of security that a neighborhood change won’t mean you’re forced out in favor of people who are willing to pay more.
Very common for commercial tenants (including escalation clauses.) Only version I’ve ever seen with a residential tenant would be an option to renew (governed by terms/limitations), not a long-term lease. Would be highly suspect of anyone who wanted to “sell” you a long-term residential lease.
for a good rent amt, I would be willing to sign a 10 yr lease. for yr 1-3, land lord happy to get stable rent as rent continues to drop. yrs 4-10, tenant happy as econ recovered, taxes + water + utilities are up, rents up,… but rent is flat.
can see value and mkt for it but do agree it’s probably not a mass appeal