Lease Agreement Cost

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What does a lease agreement cost? Property owners who are thinking about renting their space to a tenant often ask this question. So let’s explore this question and review some general information about lease agreements and how they work.

How Much Does a Lease Agreement Cost?

A lease agreement is a legally binding contract between a property owner, called the landlord, and a person who rents the property, referred to as a tenant. The lease agreement lays out the terms and conditions under which the tenant can use the property and how much the landlord will charge for the use of their property.

There are two main categories of lease agreements:

  1. A residential lease agreement
  2. A commercial lease agreement

Residential lease agreements are used when a tenant wants to rent a living space from a landlord. This can be:

  • A house
  • An apartment
  • A condo
  • A room in a house

Commercial leases are used for renting space to run a business like an office space or brick and mortar store.

A lease agreement is an important document for both the landlord and the tenant. This contract lays out the rights and responsibilities of each party and protects each party for certain liabilities. A well-drafted lease agreement will help facilitate a successful business relationship and avoid disputes.

The landlord typically drafts lease agreements, and many landlords choose to hire an attorney for this job. An attorney will know what terms and conditions must be included in the lease and ensure that the contract adheres to all state and local laws regarding lease agreements.

Based on ContractsCounsel’s marketplace data, the average cost of a lease agreement project is $595.00.

What’s Included in a Lease Agreement?

The terms and conditions in a lease agreement will vary based on the type of lease. For example, a residential lease must include different information than a commercial lease.

Lease agreements are also negotiable and customizable. Landlords and tenants can add custom terms where they see fit.

Although lease agreements will vary from property to property, all lease agreements should include the following basic information:

  • Party Information. The lease must include the landlord and tenant's names and addresses. In addition, if either party is a business, the business information must be included.
  • Property description. The property description includes the property address, square footage, amenities, and features.
  • Duration of the lease. Lease agreements must specify the length and whether there is an option to renew. Residential leases are typically one-year but can also be six-month, seasonal, or month-to-month. Commercial leases tend to be longer.
  • Rental price. This is the monthly rate that the tenant must pay the landlord.
  • Deposits. Most leases require a security deposit that will be returned to the renter at the end of the lease if no money is owed and there is no damage to the property.
  • Utilities. The cost of utilities will depend on the lease. Some leases include utilities like electric and water in the monthly rate. Some landlords will require that tenants pay for utilities separately. This should be negotiated between the parties before signing the lease.

Additional terms and conditions can be added to any lease. An attorney with experience drafting leases will know what terms and conditions should be added to protect the landlord and the tenant.

Types of Lease Agreements

There are several types of lease agreements, and each one is used for a different kind of property or rental situation.

Common types of lease agreements include:

  1. Fixed-term lease
  2. Automatic renew lease
  3. Month-to-month lease
  4. Standard residential rental lease
  5. Short-term or vacation rental lease
  6. Sublet lease
  7. Room rental lease
  8. Commercial lease
  9. Land lease
  10. Rent-to-own lease

Consult with your lease agreement lawyer if you are unsure what type of lease agreement is right for your rental.

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Lease Agreement Drafting Services

It is recommended that a landlord hires a lawyer to draft their rental lease agreement. Any mistakes or omitting a necessary clause could open a landlord to legal and financial liability.

An attorney with experience drafting lease agreements will know which clauses must be included to protect the landlord’s interests and avoid disputes.

When drafting a lease agreement, a lawyer will consult with the landlord to learn about the property and what conditions the landlord wants to include. Then, a lawyer can guide the best type of lease for the landlord’s rental and any additional clauses that need to be included.

Rental Lease Agreement Review Services

When tenants sign a lease agreement, they take on a large responsibility. A good rule of thumb with contracts is that they most often favor the drafter – in this case, the landlord. A tenant may want to hire an attorney to review the lease agreement before they agree to sign.

A tenant’s lawyer will review the lease in the tenant’s best interests. The lawyer can even negotiate on the tenant’s behalf to ensure that all terms and conditions are fair and legal.

Lease Agreement Drafting Cost

Lease agreement drafting costs can vary based on:

  • The length of the lease
  • The complexity of the lease
  • How many custom terms need to be included in the agreement

ContractsCounsel’s marketplace data shows the average lease agreement drafting costs are $485.00 across all states.

Lease Agreement Review Cost

When tenants hire an attorney to review a lease agreement, they will be responsible for their legal fees. The lawyer will charge for their time reviewing the contract, suggesting edits, negotiating, and meeting with the client.

ContractsCounsel’s marketplace data shows the average lease agreement review costs are $650.00 across all states and industries.

How Do Lawyers Charge for Lease Agreements?

Hourly Rates for Rental Lease Agreements

Lawyers in all legal fields commonly use hourly rates. Under an hourly rate fee structure, the lawyer will provide a client with their hourly rate. If the client agrees, the lawyer will begin working on the task while keeping track of their billable hours.

At the end of the job, the lawyer will bill the client for the total number of hours spent working on the case.

The marketplace data for ContractsCounsel shows that the average hourly rate for a lease agreement lawyer ranges from $200 - $350 per hour.

Flat Fee Rates for Rental Lease Agreements

A flat fee rate is a more straightforward way to bill clients. Instead of charging hourly, the lawyer will quote the client a total fee for all legal services associated with the specified project. This fee is typically paid upfront before the lawyer begins work on the case.

Clients should be sure they understand what services are included in the flat rate fee. For example, suppose the lease agreement requires revisions or the client requests additional meetings with the attorney, this extra time may not be included in the fee, and they could be subject to more legal expenses.

ContractsCounsel's marketplace data shows the average flat fee rate for a lease agreement is $595.00.

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