The Contract of Sales and Leases Flashcards
Lease
A contract whereby, for a consideration, usually termed rent, one who is entitled to the possession of real property transfers such rights to another for life, for a term of years, or at will.
Leasehold Estate
The interest or estate which a lessee of real estate has therein by virtue of the lessee’s lease.
- Leasehold for years = a lease for years (specified period of time)
- fewer of bundle of sticks, you don’t have the deed, no fee simple
Periodic Lease
Also known as a tenancy from year to year, month to month, or week to week, is an estate that exists for some period of time determined by the term of the payment of rent.
-renews on its own after specified period of time
Estate at Will
People can cancel this at anytime. Just give notice (30 days)
Tenancy at Sufferance
When the tenant holds over
-Holdover Tenant: a tenant who remains in possession of leased property after the expiration of the lease term
Covenants
Agreements written into deeds and other instruments promising performance or nonperformance of certain acts, or stipulating certain uses or non-uses of the property. (aka: Promises)
- Capacity of contract: over 18 yrs, must be sane,
- A demising clause - “the demised premises..” (when the property is going to be handed over)
- Description of the premises: property number, unit #
- Clear statement of the “term” (length) of lease
- Consideration (specification of the rent or sales price)
- Penalties for late rent
- Must be in writing (applies for leases longer than one year) Statue of frauds
- Signature (not notarized) unless to be recorded
- “Plain language” requirement for residential leases
- Use provisions: lawful purpose use, common in commercial leases, renewal of lease
- Rent control and rent stabilization laws
Security Deposit
A monetary deposit given to a lender, seller or landlord as proof of intent. Security deposits can be either refundable or nonrefundable, depending on the terms of the transaction.
- required in a lease
- if 6 units or more, the security deposit must be placed in a separate interest bearing, bank account
- landlord can’t co-mingle funds
- liquidating damages at the end
Assignment
The method or manner by which a right or contract is transferred from one person to another
- go to landlord to assign property to someone else
- Privity goes from landlord to signee (new tenant)
- landlord’s consent can’t be unreasonably withheld
Sub-lease
An arrangement in which the lessee (tenant) in a lease assigns the lease to a third party, thereby making the old lessee the sublessor, and the new lessee the sublessee, or subtenant.
- landlord has to consent to sublet
- landlord’s consent can’t be unreasonably withheld
Eviction
A legal proceeding by a lessor landlord to recover possession of real property.
Actual Eviction
Where one is either by force or by process of law, actually put out of possession.
-When landlord goes to property and takes tenant out and changes the locks…self help….it’s illegal. They have to petition the court. (Tenant’s personal property is in the property itself)
Constructive Eviction
Any disturbance of the tenant’s possession of the leased premises by the landlord whereby the premises and rendered unfit or unsuitable for the purpose for which they were leased.
- right to change the terms of the lease and leave the unit
- unit is no longer habitable
Quiet Enjoyment
The right of an owner or a person legally in possession to the use of property without interference of possession.
Possession and Habitability (Warranty of Habitability)
- required in a lease
- insures that the place is habitable
Lease Requirements
- Security Deposit
- Possession and Habitability (Warranty of Habitability)
- Improvement (maintenance and repair)
- Assignment
- Sublet
- Apartment Sharing (can’t say a family member can’t share the unit)
- Termination
Lease Termination
- Lease term ends
- 30 day notice (month to month lease)
- Eviction: actual eviction, constructive eviction
- Unit abandonment
- Sale of property
- Death of one of parties
Ground Lease
An agreement in which a tenant is permitted to develop a piece of property during the lease period, after which the land and all improvements are turned over to the property owner.
- developer doesn’t own the building itself - selling someone the right to live in the building
- see it often in co-ops
Graduated Lease
A lease which provides for a graduated change at stated intervals in the amount of the rent to be paid; used largely in long-term leases.
Gross Lease
A lease of property whereby the lessor is to meet all property charges regularly incurred through ownership
Index Lease
A lease tied to an index such as the Consumer Price Index
Land Lease
A land lease–also called a ground lease–is a lease agreement that permits the tenant to use a piece of land owned by the landlord in exchange for rent.
Net Lease
A lease that requires the tenant to pay, in addition to rent, some or all of the property expenses that normally would be paid by the property owner. These include expenses such as real estate taxes, insurance, maintenance, repairs, utilities, and other items.
Triple Net Lease
A lease in which the tenant or lessee is responsible for paying a portion of or all of the common expenses related to real estate ownership, in addition to base rent.
Option to Renew
A clause in a lease that outlines the terms for renewing or extending an original lease agreement.
Percentage Lease
A lease of property in which the rental is based upon the percentage of the volume of sales made upon the leased premises, usually provides for minimal rental.
Proprietary Lease
A lease given by a corporation to another. It is often used in a co-op context, where the owner is given a certain number of shares in the co-op, along with a proprietary lease for one of the residences in the building.
-get stock share and right to live there
