Leases and other real estate agreements

What a lease transfers

A lease gives a tenant possession and use of property for a term in exchange for rent or other consideration. The landlord, or lessor, retains ownership; the tenant, or lessee, receives a leasehold interest. A license merely permits a use without granting a leasehold. A purchase agreement concerns a transfer of ownership, while an option gives its holder a right to buy on agreed terms without an obligation to exercise it.

Read duration and payment separately

A fixed-term tenancy has an agreed ending date. A periodic tenancy renews for successive periods until properly terminated. A tenancy at will lacks a fixed term and continues by consent. A tenancy at sufferance describes possession retained after the tenant's right to possess ends, without the landlord's consent. In California, a lease longer than one year generally must be in writing and signed by the party to be charged. Identify the parties, premises, term, rent, permitted use, repair duties, transfer restrictions, and renewal terms.

A gross lease generally places property operating expenses on the landlord. A net lease shifts specified expenses to the tenant; read which expenses. A percentage lease ties some rent to business sales. These payment labels do not determine the length of the tenancy.

Assignment is not subleasing

An assignment transfers the tenant's entire remaining leasehold interest. A sublease transfers less than that entire interest, with the original tenant retaining a reversion. The original tenant generally remains liable on the original lease unless released. Consent to an assignment is not itself a release. A novation substitutes a new obligation or party with the required agreement and releases the replaced obligation. A property management agreement instead authorizes management services; it does not by itself make the manager the tenant.

California protections affect the agreement

For a business negotiating a covered residential tenancy longer than one month primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, California requires delivery of a translation before execution. The translation covers the terms and conditions. A qualifying tenant's own independent adult interpreter can create an exception for a residential agreement. Covered agreements with qualified commercial tenants also receive translation protection, but that interpreter exception does not apply to them. A waiver of these translation protections is void and unenforceable.

For covered California residential tenancies, just-cause protections can limit an owner's ability to end possession. An expiration date alone is not a complete eviction analysis. Coverage, exemptions, notice requirements, and local protections must be checked for the particular property. Where periodic pest control service is contracted for, California requires the landlord to give each new residential tenant a copy of the pest control company's notice.