Unit 18: Leases

renewal option

A clause in a lease that grants the lessee the privilege of renewing the lease.

Which of the following describes a net lease?

A lease in which the tenant pays rent, plus some—or most—of the operating expenses related to the property

ground lease

A lease of land only, on which the tenant usually owns a building or is required to build as specified in the lease. Such leases are usually long-term net leases; the tenant's rights and obligations continue until the lease expires or is terminated through default.

percentage lease

A lease, commonly used for commercial property, whose rental is based on the tenant's gross sales at the premises; it usually stipulates a base monthly rental plus a percentage of any gross sales above a certain amount.

Estate (tenancy) for years

A leasehold estate that continues for a definite period. Period may be years, months, weeks or even days

nondisturbance clause

A mortgage clause stating that the mortgagee agrees not to terminate the tenancies of the lessees in the event the mortgagee forecloses on the mortgagor-lessor's building.

security deposit

A payment by a tenant, held by the landlord during the lease term and kept (wholly or partially) on default or destruction of the premises by the tenant.

month-to-month tenancy

A periodic tenancy under which the tenant rents for one month at a time. In the absence of a rental agreement (oral or written), a tenancy is generally considered to be month to month.

holdover tenancy

A tenancy whereby a lessee retains possession of leased property after the lease has expired and the landlord, by continuing to accept rent, agrees to the tenant's continued occupancy as defined by state law.

Which of the following describes a gross lease?

An agreement in which the tenant pays a fixed rent and some or all of the utilities and the landlord pays all taxes, insurance, and expenses related to the property

estate (tenancy) at sufferance

Arises when a tenant who lawfully took, possession of real property continues in possession of the premises without the landlords consent after the right of possession has expired.

constructive eviction

As interpreted in Georgia case law, a tenant's right to vacate property and cease rental payments if the tenant can show that the landlord's willful conduct or negligence has resulted in the property's becoming unsafe or unfit for habitability.

estate (tenancy) from period to period

Created when the landlord and tenant enter into an agreement for an indefinite time-that is, the lease does not contain a specific expiration date. Automatically renewing.

The death of the landlord will terminate the lease and the parties' heirs will NOT be bound by its terms under which of the following estates?

Estate at will

Which type of leasehold estate lasts for a definite period of time and then ends?

Estate for years

A lease would be terminated by which of the following?

Expiration of the term in a lease for years

A nondisturbance clause is a provision in a lease prohibiting the lessor from disturbing or interfering with the lessee's use of the premises, providing such use is NOT in violation of the terms of the lease.

False

A one-year lease is an example of an estate from period to period.

False

The covenant of quiet enjoyment means that the lessee can occupy the premises without the annoyance of nuisances such as barking dogs or late-night motorcycles.

False

estate ( tenancy) at will

Gives the tenant the right to possess property with the landlords consent for an unspecified or uncertain term. Terminate with the death of either parties.

A tenant signs a lease that includes a schedule of rent increases on specific dates over the course of the lease term. What kind of lease has this tenant signed?

Graduated

A lease in which a commercial tenant's rent amount stays the same for the term of the lease, and the tenant pays only rent to the landlord is what type of lease?

Gross

actual eviction

The legal process that results in the tenant's being physically removed from the leased premises.

sale-and-leaseback

The property owners sell the property and then lease it back for an agreed period and rental.

revisionary right

The return of the rights of possession and quiet enjoyment to the lessor at the expiration of a lease.

net lease

The tenant pays all or most of the property expenses, such as hazard insurance, property taxes, and/or common are maintenance (CAM) charges in addition to the rent.

An estate at sufferance arises when a tenant who lawfully took possession of real property continues in possession of the premises without the landlord's consent after the right of possession has expired.

True

Federal fair housing and civil right laws affect landlords and tenants just as they do sellers and purchasers.

True

In a gross lease, the tenant pays a fixed rent and some or all of the utility expenses, and the landlord pays all taxes, insurance, repairs, remaining utility expenses, if any, and maintenance connected with the property.

True

In a net lease, the tenant pays most or all of the property charges, including hazard insurance and property taxes, in addition to the rent.

True

The heirs of a deceased landlord are bound by the terms of existing valid leases.

True

right of first refusal

a clause allowing the tenant the opportunity to buy the property before the owner accepts an offer from another party

lease

a contract between a landlord and the tenant

If the lease covers land, such as a ground lease,

a legal description should be used.

A family's apartment lease has expired, but their landlord has indicated to them that they may remain on the premises until a sale of the building is closed. They will be charged their normal monthly rental during this period. The right held by the family is called

a tenancy at will.

sublease

a tenant transfers less than the entire leasehold interest by subletting the premises to a new tenant

leasehold estate

a tenant's right to possess

assignment

a tenant's transfer of the remaining time on a lease to another person

A tenant moves a pet into an apartment community that has a no-pets policy. The landlord wishes to remove the tenant due to the breach. The legal process to remove a tenant is known as

actual eviction.

To be valid, a lease must meet the same essential elements as any other contract, which are

capacity to contract, legal objectives, offer and acceptance, and consideration.

Rent would BEST be described as

consideration for the use of real property

If leased premises become unusable for the purpose stated in the lease, the tenant may have the right to abandon the property and sue and recover damages against the landlord in a legal action called

constructive eviction.

The tenant leases a heated apartment, but the landlord fails to provide heat because of a defective central heating plant. The tenant vacates the premises and refuses to pay any rent. This is an example of

constructive eviction.

A tenant's tenancy for years will expire in two weeks. The tenant plans to move to a larger apartment across town when the current tenancy expires. In order to terminate this agreement, the tenant must

do nothing because the agreement will terminate automatically at the end of the current term.

The tenancy that arises when a tenant who lawfully took possession of real property continues in possession of the premises without the landlord's consent after the right of possession has expired is the

estate at sufferance.

The tenancy that gives the tenant the right to possess the property with the landlord's consent for an unspecified or uncertain term is the

estate at will.

The form of tenancy that will expire on a specific date and requires no notice is

estate for years

A person has a one-year leasehold interest in a house. The interest automatically renews itself at the end of each year. The person's interest is referred to as a tenancy

from period to period.

The tenant who remains in possession of real estate after the lease expires, and does so without the landlord's consent,

is a tenant at sufferance.

When a tenant holds possession of a landlord's property without a current lease agreement and without the landlord's approval, the

landlord can file suit for possession.

A contract that conveys the right to use and possess the property for a period of time without transferring ownership is a

lease

A contract that conveys the right to the possess the real property of another, but does not convey title, is a

lease.

A lease is a contract between

lessor and lessee.

The lessor and lessee have agreed to a lease term of five years. In order to ensure that the rental income during the term is reflective of market conditions, the lessor could

negotiate an index lease.

A lessee who pays some or all of the property expenses, such as hazard insurance and property tax, has a

net lease.

Under the negotiated terms of a certain residential lease, the landlord is required to maintain the water heater. If the tenant is unable to get hot water because of a faulty water heater that the landlord has failed to repair after repeated notification, the tenant could do all of the following EXCEPT

order a new water heater and send the bill to the landlord.

lessor

owner of real estate, landlord

Either a gross lease or a net lease may be a(n)

percentage lease.

If there is no expiration set forth in a residential tenancy, but rent is to be paid monthly, the lease is considered a

periodic tenancy.

In the absence of a notice to terminate, a lease that continues automatically would be

periodic tenancy.

A lease agreement that contains language that permits a new landlord to terminate existing leases is

permissible and enforceable.

The original owners of a commercial property may decide to pull their equity out of the property to use on other projects and reduce taxable income by paying rent to the property's new owner by means of a

sale-and-leaseback.

A tenant still has five months remaining on a one-year apartment lease. When the tenant moves to another city, he transfers possession of the apartment to a friend for the entire remaining term of the lease. The friend pays rent directly to the tenant. In this situation, the tenant has become a(n)

sublessor.

A tenancy in which the tenant continues in possession after the lease has expired, without the landlord's permission, is a

tenancy at sufferance.

lessee

tenant

If a tenant moved out of a rented store building because access to the building was blocked as a result of the landlord's negligence, the

tenant may be entitled to recover damages from the landlord.

gross lease

tenant pays a fixed rent and some or all of the utility expenses, while the landlord pays all taxes, insurance, repairs

Breach of Lease

the landlord may sue the tenant to obtain a judgement to cover past-due rent

At the termination of a rental agreement,

the lease is discharged.

purchase option

the right given by a lease to the tenant to purchase the property at a predetermined price within a certain period, possible the lease term.

Generally, an oral lease for five years is

unenforceable

lease purchase

used when a tenant wants to purchase the property but is not yet able to do so

An example of constructive eviction would be a tenant

who moves because the unit no longer has water.