Often called a “tenancy at will,” this estate occurs when the landlord allows the tenant to possess the real property for an indefinite period, usually until an anticipated event occurs. This is often the type of leasehold arrangement created when the property owner is selling the property, marketing the rental unit to a third-party renter or awaiting a future time when the property owner wants to use the property himself or herself.
For example, the strip mall owner allows Ophelia to place her antique wares in the neighboring empty store while the owner-landlord finds a new tenant. With a tenancy (estate) at will arrangement, Ophelia would have to move out her items as soon as a new tenant is found. Either party can terminate this tenancy with sufficient notice, or upon the death or insanity of either party.
When the legal relationship between the landlord and the tenant is verbal and essentially unwritten, it is usually as a periodic estate, which is sometimes called periodic tenancy or an estate (tenancy) from period to period. However, the periodic tenancy can sometimes—and probably always should be—in a written agreement.
When no lease agreement is present, state and local statutes govern the landlord-tenant relationship. One of the key statutes that apply especially to periodic estate/tenancy is the notice requirements for termination.
Periodic tenancy continues indefinitely from period to period, and does not end unless the tenancy is properly terminated. Strictly speaking, a month-to-month tenancy begins anew with each month’s rental payment. In fact, however, the tenancy renews and continues even when the tenant fails to make a timely payment.
This restriction, however, is normally a two-way street. The tenant’s responsibility will continue indefinitely unless that tenant formally terminates the tenancy. If a tenant decides to vacate the premise at the end of a paid month, that tenant will continue to be liable for future rent payments if the tenancy has not been terminated.
A late payment does result in delinquency and default . But to terminate the lease agreement, the landlord and/or tenant must provide a proper notice of termination. Each state has its own governing statutes, but most states share similar notice requirements:
- Week-to-week tenancy. The terminating party must give notice to the other party at least one week in advance.
- Month-to-month tenancy. The terminating party must give notice to the other party at least one month in advance. Note that when no tenancy period is specified by either the landlord or tenant, it is assumed to be a month-to-month tenancy.
- Year-to-year tenancy. Although most year-long tenancies are governed by (estate for years) lease agreements, if it is a periodic estate, notice usually must be provided at least three to six months in advance. Again, remember that this tenancy or leasehold estate does not terminate after one year; instead, it renews each year.
If the required termination notice period is not met, the termination notice is effectively void. Note that when the landlord is processing an eviction, most state and local landlord-tenant laws require the landlord to reject any rent payments from the tenant. If the landlord does accept a payment, the periodic tenancy may be reinstated and any eviction attempts would have to be reinitiated.