How Often in the USA Do They Not Renew the Lease Agreement?

In 2023, about thirty-five people out of a hundred tenants in America refused to re-sign their lease agreement. This implies that after months or even as much as years spent living in rental houses or flats, they were forced to start looking for new homes, and landlords had to find different tenants.

Can a landlord refuse to renew a lease without reason, and what makes tenants leave rented apartments after the agreement has expired? 

Non renewal of lease by landlord is a real nightmare for many people. However, even though moving is always stressful and burdensome, 17% of American renters whose fixed-term leases expire in 2024 do not plan to prolong them. What has led them to this decision? 

For a long time, one of the main factors that impacted the choice of rented apartment was the location. People searched for housing closer to work, with better infrastructure, and with more developed transportation.

Also, many companies offer their employees the opportunity to work remotely, which means people can move from larger cities to suburbs where they have more space for less money. 

For those not bound by location at all, there is a possibility of relocating from one state to another. For instance, if one changes a two-bedroom apartment in Hawaii to a similar apartment in West Virginia, one can save up to $800 monthly.

Nowadays, to lease comfortable housing in the United States, a person should make at least $80,000, while, just a few years ago, they needed only $60,000. For those who make less, renting means living beyond their means. The increased demand for housing, especially in the cheap and middle segment, allows most landlords to run the show, and tenants have a single option — to pay rent.

As many people work and study remotely, they need spacious housing. A one-bedroom or studio apartment may seem a comfortable place for a couple who spend most of their time in the office, but it turns into a cell if both of them work from home. Sometimes, not renewing lease letter and moving to a bigger house becomes the only way to save a marriage and sanity. 

A bedroom, bathroom, and kitchen are even less than the bare minimum one expects to see in a rented apartment. Modern people’s expectations of real estate include outdoor spaces, fast internet, and fitness areas. More than that, a pet-friendly policy turns the property into a real treasure in the rental market and increases the landlords’ chances for the existing lease renewal.

The human factor also means a lot when it comes to rent. Even the coziest house can become hated if the life in it is constantly accompanied by conflicts with the proprietor. If the landlord ignores the renters’ requests to get rid of rats or repair the leaking ceiling, the tenant not renewing lease should not be a surprise for them.

Does a landlord need a reason to not renew the rent agreement? No, they don’t. Unlike the lease termination process, contract expiration doesn’t oblige proprietors to explain it to the tenant. However, there are various reasons for lease non renewal. Let’s have a look at the most common ones:

Renting real estate out is a business and often the primary income for many landlords. Of course, there can be critical situations when the tenant asks to pay a few days later, but if it happens every month, the landlord can consider finding a new renter. Before it, they are obliged to send the current tenants a late rent notice. No one wants to suffer financial losses. 

Over time, every flat or house experiences normal wear and tear. However, a sofa covered with oily spots, cigarette ashes under the kitchen table, and a hole in a wall are not parts of it. If the damages are so serious that the rent cannot cover them, the proprietor can refuse to renew the current lease. So, our version of the theory is the following: the one who doesn’t value other people’s property is likely to change homes every year.

If renters repeatedly breach the terms of the contract — illegally sublease the property, make noise during quiet hours, or smoke in the apartment — it can be a reason not to extend it for the landlord. 

If the proprietor decides to move to a different state or just considers renting out unprofitable, they may decide to sell the house or flat. In this case, they either refuse to renew the lease agreement or allow the current renters to stay until a buyer is found. 

It’s also one of the common reasons for non renewal of lease. Once in a while, any house or flat requires major repairs and improvements. Seeing it, the landlord may notify the current renters that they won’t be able to renew the lease and make all necessary upgrades without disrupting the renters’ daily life.

Repeated complaints about the renters can become a real headache for the proprietor. If one has behavioral issues and lacks respect for community rules, a landlord not renewing lease is what they’re likely to get. 

Renters can keep pets in a house or an apartment but only after they receive the consent of the property owner. Yes, this kitty and a dozen parrots are cute, but you cannot keep them secretly. It would be considered as a contract breach. In this case, the landlord may ask the tenant to pay a bigger deposit that would cover all potential damages the pet may cause. 

It can happen that, knowing the lease expires soon, the property owner finds a new tenant who is ready to pay a higher rent or who seems more reliable. Another case is when the proprietor plans to live in the property themselves or rents it out to their friends or relatives. The main problem in such a situation is always a moral aspect: how to tell tenant not renewing lease is not their fault but the landlord’s choice?

How many times can you renew a lease? In fact, as many as you wish if both parties are satisfied with the cooperation. Out of self interest, the proprietor and the tenant should enter into a residential rental agreement. In the event disputes emerge between the two parties due to misunderstanding about the terms of the lease, then either side may seek legal redress since this document is admissible in court.

Drafting such a substantial document and not missing any important detail can be challenging for the parties. Therefore, we recommend using legal templates provided by reliable sources like Loio Templates. Drafted by experienced lawyers, they cover everything that the landlord and tenant may require to know in terms of their rights and responsibilities.

In addition, the renter should be served with a written lease non renewal letter at least one month prior to the end of the present lease expires.In it, the proprietor informs the lessees about the decision not to prolong the contract so that the latter have enough time to find new housing.

So, what happens if you don't renew your lease? You’ll most likely search for a new home, and you’ll be not alone in it. Every third lease agreement in the US isn’t prolonged, and there are a variety of reasons for that.

On the one hand, tenants usually make choices in favor of cheaper or more comfortable options. On the other hand, landlords expect to find renters who would pay more and take care of their property. In any case, if your lease is not prolonged, you can ask the property owner for a landlord reference letter that will increase your chances of finding a new home quickly. 

This constant movement of tenants is simultaneously the sign of a crisis and what makes the rental market alive. The fact that people are ready to leave their lived-in apartments and move to different areas and even cities demonstrates the lack of stability in their lives and the need to adapt to ever-changing conditions. 

Nevertheless, landlords should also learn to meet the market demand — make renovations, create better conditions, and be flexible in terms of process. Otherwise, they will be left behind the highly competitive market and out of income when current renters' lease expires.