Texas Principles of Real Estate II - Chapter 9: Section 7- Leases

What 4 rights are conveyed to a lessee through a lease?

1. Exclusive possession and occupancy 2. Exclusive use 3. Quiet enjoyment 4.Profits from use

What are the 4 components of an Estate for Years?

1. Has a definite beginning and ending date. 2. Not necessary to give notice to the landlord to terminate. 3. NO automatic renewal. When this type of lease is over, it's over. 4. Commonly used with commercial leases and some apartment leases.

What 3 tenant obligations are defined in a lease agreement?

1. Pay the rent on time 2. Maintain the property's condition 3. Comply with the rules and regulations of the building

An Estate from Period to Period can also be called: 1. 2. 3.

1. Periodic tenancy 2. Periodic lease 3. Month-to-month lease

The lease defines what 2 obligations of the landlord?

1. Provide the necessary building support and services 2. Maintain the condition of the property

Two features of periodic tenancy

1. Requires proper notice to terminate 2. No definite ending date.

What are the 7 reasons that a lease may terminate?

1. Term expiration 2. Notice 3. Voluntary agreement 4. Property destruction 5. Condemnation 6. Foreclosure 7. Breach of contract or default

What year was The Americans with Disabilities Act enacted?

1990

What is a holdover tenant?

A tenant who doesn't leave when the lease expires.

Estate at Sufferance

Created when a tenant takes legal possession of the property but then remains on the property without the owner's consent after the lease terminates.

What is the most common periodic tenancy?

Month-to-month tenancy

What does an "assignment" of lease do?

It is a transfer of the entire leasehold interest by a tenant, the assignor, to a third party, the assignee.

With what type of lease does the tenant agree to pay all taxes, insurance, maintenance and repairs?

Net-net-net lease (Triple net lease)

Gross Lease

Requires the landlord to pay the property's operating expenses, including utilities, repairs, and maintenance, while the tenant pays only rent.

How much is a landlord liable for if he/she does not return the security deposit?

Landlords can be liable for 3X the amount of the deposit plus $100 and any applicable attorney fees.

What is the Demising Clause in a lease?

Talks about when the landlord leases the property and the tenant takes possession of the property.

Net Lease

Tenant pays the rent for occupancy and maintenance and operating expenses such as taxes, insurance, utilities and repairs.

What is the landlord's "Implied warranty of habitability"?

Tenants are entitled to a safe and livable home.

According to the ________________________, the landlord has the right to set a maximum number of adults age 18 or older in his property. Texas law allows the landlord to set that maximum to three times the number of bedrooms.

Texas Property Code 92.010

In a Percentage Lease, what does the "recapture clause" state?

That if the tenant does not obtain the desired gross sales, the owner has the right to terminate the lease

What act primarily addresses the lease contract, deposits and advances, obligations of landlord and tenant, the landlord's rights of access, and standards for eviction.

The Uniform Residential Landlord and Tenant Act (URLTA)

What is the time limit on an Estate at Will?

There is no time limit.

A residential lease may be a net lease or a gross lease.

True

What is constructive eviction?

Where the landlord's negligence or disruptive action has rendered the property unoccupiable, a tenant may vacate the premises and declare that the lease is cancelled by default.

In Texas, how many days does a landlord have to refund the security deposit for residential leases?

Within 30 days of surrender of the premises.

In Texas, how many days does a landlord have to refund the security deposit for commercial leases?

Within 60 days of surrender of the premises.

What is the purpose of The Uniform Residential Landlord and Tenant Act (URLTA)?

1. Equalize and standardize rights of landlord and tenant 2. Protect tenants from unethical practices 3. Prevent unfair, complex leases and their enforceability

In conveying the leasehold estate, the landlord acquires a leased fee estate, which entails what 3 rights?

1 Receive rent 2. Re-possess the property following the lease term 3. Monitor the tenant's obligations to maintain the premises

What are the eight most common covenants in a lease?

1. Capacity to contract 2. Demising clause (transfer by lease) 3. Description of the premises 4. Clear statement of term 5. Specification of rent and how it is to be paid 6. In writing 7. Signatures 8. Delivery

In a lease agreement, what is an option to renew?

A lease provision that gives the tenant the right to extend the lease for an additional period of time and sets forth the terms for the renewed lease.

What does the Keating Memo published by HUD state?

A reasonable occupancy is two people per bedroom, and an infant less than six months old can sleep in the parent's bedroom.

When can an Estate at Will be terminated?

Can be terminated by either party at any time, with proper notice.

What does the The Fair Housing Amendments Act of 1988 outline?

Design and construction requirements for covered multi-family dwellings for first occupancy after March 13, 1991

What are the 4 basic types of leasehold estates?

Estate for Years Estate from Period to Period (Periodic estate) Estate at Will Estate at Sufferance

Most apartment leases are _________________________________ if the tenant is required to give notice to terminate.

Estates from period to period

Only the tenant is required to sign a lease.

False. The landlord must sign the lease to convey the leasehold interest. A tenant is not required to sign the lease, but it would be best to do so in order to enforce the terms of the lease.

There is always an agreement of rent with an Estate at Will.

False. The possession is given with permission but there is no agreement about the rent

What does the repair-and-deduct option allow?

It allows for the tenant to arrange and pay for repairs, then deduct the amount from rent payments.

Ground Lease

Owner grants the tenant a leasehold interest in the land only, in exchange for rent.

A _______________________ is a lease whose rental is based on a percentage of the monthly or annual gross sales made on the site.

Percentage Lease

A __________________________ conveys a leasehold interest to an owner of a cooperative.

Proprietary Lease

Graduated Lease

Rent payments start at a fixed amount but increase as the lease term matures.

With the repair-and-deduct option, what is the monthly maximum deduction allowed for repairs?

The deductions for repairs for any month may not exceed one month's rent or $500, whichever is greater. Subsidized