A Lease is a legally binding agreement between a landlord and tenant over a property or area of land for a term certain for a rent.
What is the purpose of a Lease?
A tenant will only have a lease over a leasehold property for a fixed period of time.
A lease is the legal agreement with the landlord (sometimes known as the ‘freeholder’). The lease protects both the landlord and tenant by letting each of them know their responsibilities and obligations.
Ownership of the property returns to the landlord when the lease comes to an end.
Most flats are leasehold. Houses can be leasehold too and usually are if they’re bought through a shared ownership scheme.
What is the difference between a Lease and a Licence?
- A lease gives a tenant ‘exclusive possession’ of a property or area of land.
- A licence merely grants permission to do something and does not give exclusive possession (for example, a market stall)
What does a Lease include?
Leases will include a variety of clauses. Some of the clauses you may find in a lease are below:
- The length of the agreement
- Names and addresses of the landlord and tenant
- Rental property address and details
- The agreement in relation to rental payment (the amount, the procedure for collecting rent)
- The obligations of the tenant whilst leasing the property
- Whether the landlord or tenant can end the lease early
- Whether the tenant can assign the lease to anyone else
Examples of property that can be leased:
Residential – a flat or house
Commercial – retail or office premises
Industrial a warehouse
Land for agricultural use
Examples of tenants in a lease:
An individual living in residential rental space
A retail store looking for space to operate their business
An office or business, looking for a space for their practice
How Many Pages Should a Lease Be?
Leases can range from being anywhere from one page to twenty pages, depending on the amount of information covered. The more in depth your lease is, the better protected you are – however, it is important not confuse a long lease with a good lease!
If you would like Ringrose Law to act on your behalf for your Commercial Property transaction, please contact a member of the Commercial Property team at Ringrose Law’s Newark office.