A
tenancy of an uncertain duration, by example, from verbal consent, is termed a
periodic tenancy or tenancy from period to period. Such tenancy will remain in effect until either the landlord or
tenant gives notice of termination.
Usually, the rental period determines the length of notice
required. That is, a week’s notice is
required to end a week-to-week tenancy.
A month's notice is required to end a month-to-month tenancy. A notice of from 1 to 6 months is likely to
be required to terminate a year-to-year tenancy. And a tenant holding over from a tenancy for years, where rental
payments are accepted monthly, is likely to create a month-to-month tenancy.
The
most common lease classification system is by a rental payment method. Ground leases and sale leaseback
arrangements are also classifications of leases which may overlap, and, are
therefore not mutually exclusive. For
example, a sale leaseback arrangement might actually be a ground lease calling
for a net rental.
Flat lease. An arrangement calling
for a fixed rental to be paid periodically throughout the entire life or term
is a flat lease, or a fixed rental lease.
This arrangement, which at one time enjoyed wide use and popularity, has come into gradual
disuse for long term leasing purposes, resulting, no doubt, to inflation. Thus, when rental amounts are fixed over a
long period, a declining dollar value deprives the landlord (owner) of a
competitive return in proportion to the value of the property. Consequently, the use of the flat lease is
increasingly restricted to short-term, month-to-month leases, or, at maximum,
yearly leases. A flat lease calling for
the Lessor to pay all property carrying charges as taxes, insurance, and
maintenance is a gross lease.