A tenant will enter into an agreement with a landlord outlining expectations for both parties during the tenancy. If the landlord decides to make changes in the tenancy agreement, they won't happen immediately. The changes depend on several factors, including the length of the tenancy, the terms of the original agreement and what the changes pertain to. When renting in California, the landlord and tenant enter into one of two types of contracts: a rental agreement or a lease, both of which give the renter permission to live in the landlord's rental property for a specified amount of time. Landlords and tenants use these terms interchangeably, although they do have distinctly different meanings.
What Is a Tenancy Agreement?
A tenancy agreement, also called a periodic rental agreement, covers the time period between rent payments, which are usually from week to week or month to month. A month-to-month contract is more popular, but no matter how much time the tenancy agreement covers, it expires at the end of each period and renews with the next rent payment. The landlord allows the tenant to live in the rental property as long as she continues to make rent payments and there are no other extenuating circumstances causing the landlord to ask her to leave.
A periodic rental agreement covers these responsibilities between a tenant and a landlord:
- Term of the tenancy.
- Amount of advance notice the landlord and tenant must give the other party if ending the tenancy.
- Amount of advance notice the landlord must provide to the renter if he wishes to changes the terms of the rental agreement.
Tenancy Agreement and Fixed Lease Differences
A rental agreement can be oral or written. A verbal rental agreement is legal in California and covers the tenant's intent to rent the unit, how much she will pay and for how long she'll pay it. A written agreement covers much the same things and may also contain clauses on parking, pets or late fees.
A lease agreement can also be oral or written, but it's for a fixed term of usually six to 12 months. If a fixed lease covers more than 12 months, it must be in writing. While a lease requires payment once a month, it binds the tenant to the rental property until it expires. The tenant must pay rent and perform all other responsibilities in accordance with the lease during that period. The landlord must also keep his obligations to the tenant in accordance with the lease during that time.
Read More: California Lease and Rental Agreement Laws: Tenant Rights
Tenancy Agreement Advance Notification
According to California Civil Code Section 827(a), a landlord can change the terms of a tenancy agreement if he does so in writing and if the amount of advance notice equals the length of time between the tenant's rent payments. For example, if a landlord changes the amount he charges a tenant for parking, he must give her at least 30 days' advance notice if she is on a month- month-lease. If she has a week-to-week tenancy, the landlord must give at least a week's notice.
In a month-to-month agreement, the amount of notice time can be less than 30 days if the landlord notifies the tenant in writing that he wishes to change advance notice to a shorter period and the tenant agrees. For example, he can ask for 10 days' advance notice for a change to their initial rental agreement. If the tenant agrees, that's what it will be going forward. Whatever amount of time they mutually decide upon cannot be shorter than seven days.
Notification for Rent Increases
As with any other change to a periodic rental agreement, a landlord must give her tenant notice of a rent increase. The notice must state the amount she plans to raise it by and when the rent increase will take place. According to California law, a landlord must give a tenant at least 30 days' notice if the payment increase is 10 percent or less of payments charged at any time during the year before the increase takes effect. If it's more than 10 percent, the landlord must give his tenant 60 days' notice of the increase.
The tenant must use the lowest amount of rent paid over the last 12 months as a guide to calculate the amount of the increase and when she will get advance notice. If her rent was $800 10 months ago, but she saw a $50 increase four months later that brings the total to $850, and she's now seeing another $25 increase, she must get 60 days' advance notice, as her rent will go up about 18 percent.
Notice Delivery and Rent Charges
No matter how long the term of advance notice is, the landlord must deliver notice to the tenant in writing. He can deliver it personally or send it by first-class mail, but he must do so with the proper postage addressed to the tenant at the rental property. When mailing the rent increase, the landlord must add five days to the requisite notice of 30 or 60 days before the rent hike can take place. As an example, if a landlord increases the rent by 10 percent or less on October 1, he must deliver the notice of the increase personally by September 1 or mail it by August 27.
If the rent increase goes into effect in the middle of the rental period, the landlord can only receive the increased amount for the last half of the period. As an example, if the tenant is on a month-to-month lease from October 1 to November 1, his rent increases less than 10 percent and he receives the notice on October 15, the increase cannot take place until November 15. A periodic rental agreement allows the landlord to increase the rent as often as he likes. However, the increases cannot be retaliatory. Many California cities also have rent control ordinances in place that will impose rules as to how and when a landlord can increase a tenant's rent.