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Tenancy at Will

DEFINITION

Tenancy that exists without an official lease agreement that can be terminated by both the landlord and tenant at anytime.

EXPLANATION

A tenancy at will is a flexible lease in which a tenant occupies a property without a formal written agreement. Typically, this type of agreement has no definitive beginning or end date; rather, a landlord agrees to lease to a tenant “until further notice”. An “estate at will” and a tenancy at will are used interchangeably.

For example, a landlord may allow a friend or family member to rent one of his or her properties without a formal lease in place.

The tenant or landlord has the right the opt out of a tenancy at will at any time and for any reason.

Although this can provide flexibility, it can also produce uncertainty for both the tenant and landlord.

For example, if a tenant suddenly needs to relocate for a job, the tenant could move out with no advance warning and leave the landlord with a non-rented unit. Alternatively, because a tenant at will is not locked into a written lease agreement, a landlord has the ability to raise rental rates without warning.

Tenancy at Sufferance vs Tenancy at Will

A tenancy at sufferance is when a tenant whose lease has expired continues to lease a property without signing a new agreement. This “holdover” tenant typically continues to uphold the terms of the original lease until a new one is created.

A tenancy at will and a tenancy at sufferance are similar in that both situations feature a tenant who lives on a property without a current lease. However, a tenancy at sufferance differs in that the tenant did once have an official agreement.

In California, a “holdover” tenant who does not pay rent after a lease’s expiration date is considered a trespasser.

Purpose of Tenancy at Will

A tenancy at will is typically established when both the landlord and tenant wish to immediately enter into an agreement, however do not have the time for formal documents. This might occur when a landlord wishes to immediately have a tenant move in the property.

Another reason parties may use a tenancy at will is when either the landlord or tenant, or both, want to have flexible rental terms. This is often the case when the landlord is considering renting the rental rates in the future, is giving a discount to the tenant, or wants to develop the property. Such an arrangement grants the landlord flexibility to remove the tenant with a reasonable advance warning. A tenancy at will is the best option when the tenant wants to remain in the unit for a limited period of time or doesn’t know how long they want to remain. This type of tenancy works well for tenants who share roommates. While it may not always be the case, there remains a possibility roommate might not pay their required share and such an arrangement easily allows both roommates and the landlord to terminate the lease.

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