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  • Category: Indian Law

    What is short term lease and long term lease


    Are you confused between various types of lease agreements? Searching for the difference between short term and long term lease? Find answers about the difference among these lease agreements and the Government guidelines on this Ask Expert page.

    The agreements in respect of lease of land and buildings are signed specifying certain period in respect of its period of validity. Some agreements are signed for 11 Months, some are for five years and some are for longer period. Some lease agreements are called as short term lease agreement and some called long term lease agreement.
    Are there any specific period of lease agreement which can be termed as short term lease agreement or long term lease agreement?
    Any Government of India guidelines available on this matter?
  • Answers

    3 Answers found.
  • A short-term lease is a lease with a duration of fewer than six months. They are based on a month-to-month rental agreement, which may or may not be renewed at the end of each month. Monthly agreements are common. But there weekly, or even less than one week in the case of vacation rentals.
    Leases which are generally more than 6 months will be called as a Long term lease agreement. But there are no specific rules about these long and short term agreements.
    The rentals will be higher in short term leases than those of long term leases for similar properties.
    Generally, each renewal of lease will normally be accompanied by an increase in rent.
    When a new lease is signed there are good chances to get significantly higher rent than with the previous lease.
    In the case of a long term lease, lease terms and conditions are for a longer period of time. It is difficult to change the terms and conditions in between. With short term leases, the terms and conditions can easily be changed when we go for renewal or a new lease agreement.

    drrao
    always confident

  • Lease or rental agreement is a contract between the owner and the tenant. In legal terms they are known as lessor and lessee.

    Lease can be pertaining to a house or a land. In case of the house the lease for a period of less than 6 months is termed as short term lease while in case of a land it can be somewhere 10 years. A long term lease for the house is generally more than 6 months while for land it is 10 to 99 years.

    Short term lease is generally given when the property is vacant for a small period and the chances of lease renewal are minimal. The terms and conditions of the lease agreement are accordingly prepared.

    The long term lease is generally for a longer time but the contracts are executed after every 1/2/3 years periodically. These are renewed with the rate escalation as mentioned in the original contract.

    A lease agreement has to contain the terms and conditions in a legal format leaving no room for disputes and ambiguities in the future.

    Knowledge is power.

  • Though lease is a general term in the legal parlor but most of the time it is used for rental lease.

    Short term lease is only for a short period of 6 months or less while above 6 months it is called as long term lease.

    In our country, the short term lease is not very common but 11- month rental lease is very common which is renewed time to time.

    There is generally one important clause in the lease which says that lease can be extended for a similar period on mutual consent.

    The rates for the extension of the lease are also indicated in the present agreement.

    Thoughts exchanged is knowledge gained.


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