Automatic Renewal and Non-Renewal of Leases
Leases are legal contracts whether they are verbal or written. A lease may specify that it automatically renews if no notice is given by either party. The lease may automatically renew for another year or on a month-to-month basis.
Both landlords and tenants, who do not wish to renew the lease at the end of the lease term must ensure that they give proper notice in accordance with the lease requirements. For example, a lease may state that either party must give 30 days written notice before the end of the lease term if they do not wish to renew the lease. Notice of non-renewal should always be given in writing. At the end of the lease, neither party is legally obligated to renew the lease with the other party, but landlords need to take care that non-renewal decisions are not retaliatory or based on discriminatory reasons.
While a reason for non-renewal does not need to be stated, under state and federal fair housing laws, landlords are prohibited from retaliating against a tenant for exercising a fair housing right or assisting others in exercising their fair housing rights. Pennsylvania Landlord Tenant law additionally prohibits a landlord from retaliating against a tenant for joining a tenants association. This includes a landlord’s refusal to renew a lease because a tenant has joined a tenants’ association.
Examples of retaliatory non-renewals:
- A tenant requests a reasonable accommodation to have an assistance animal. The landlord grants permission but, several months later, refuses to renew the lease despite having a history of regular lease renewals and having no evidence of the tenant breaching the lease.
- A landlord issues a non-renewal notice after a tenant has filed a fair housing complaint alleging sexual harassment by a maintenance person employed by the landlord.
- A landlord issues a non-renewal to a tenant after the tenant has provided fair housing information and assistance to another tenant who alleged racial discrimination.
In addition to fair housing laws which prohibit retaliation, landlords cannot subject tenants to differing terms and conditions or enforce rules differently based on a protected class. Landlords must enforce rules and breaches of the lease consistently without regard to protected class status. If a landlord chooses not to renew the lease of a tenant, alleging a breach of the lease, such as repeated late rental payments, and the tenant files a discrimination complaint with FHEO, the landlord must show that other tenants have been treated in a similar manner.
The best way for a landlord to avoid liability is to embrace fair housing practices and document adherence to policies that are applied uniformly. Landlords should make decisions regarding non-renewal using only objective verifiable criteria. Landlords should establish a record keeping system which show that policies are being applied uniformly. If a landlord needs to defend against a discrimination complaint, they should be able to show justification for the non-renewal and have documentation that the non-renewal is based on permissible reasons and is not retaliatory or discriminatory.
If a tenant is a military service member or serves with the Pennsylvania National Guard, the tenant has the right to terminate or cancel a lease without penalty if they are called for duty for consecutive periods longer than 30 days. This does not apply for training purposes. The tenant is required to provide a written notice to the landlord by personal service or by first class mail.
A landlord cannot evict a tenant who is called up for active duty without a special court action. The court can stay any proceedings for 6 months.
Pennsylvania has no rent-control law. Landlords may raise the rent as much as they want. However, changes must be made in accordance with the lease.
- The rent increase must follow the proper notice procedures outlined in the written or verbal lease.
- A landlord may not raise the rent in the middle of the lease term unless the tenant agrees to the rent increase.
- A landlord cannot raise rent in retaliation because the tenant exercised a legal right. The landlord is not allowed to raise the rent because a tenant filed a complaint of discrimination or contacted code enforcement.
- If a landlord raised the rent because a tenant filed a complaint of housing discrimination, this will complicate your legal liability as it will be seen as a retaliatory action.
If the Lease Is Not Renewed
- Tenants should give the landlord proper notice that they will be vacating the rental property.
- This notice must be in accordance with the provisions of the lease. Notice of non-renewal of the
lease should be delivered as outlined in the lease with the proper amount of notice that is required.
- The tenant is required to give the landlord their new address in writing at or before the time they move out. A tenant must do this even if it does not say so in the lease.
- The tenant should clean the dwelling unit as thoroughly as possible before moving out. Remember that the tenants should clean the inside of the stove and the refrigerator and dispose of any trash. A tenant should not leave anything behind. If the tenant has failed to do any of these things, you should document it with photos and receipts for cleaning.
- In order to get the security deposit refunded, the tenant must have paid all rent due.
- It is a good idea to inspect the dwelling unit with the tenant before they move out. Go over any damages that you find. Allow the tenants to repair any damages that are minor and easy to fix.
- Take photographs of the empty unit. This is the time to go over your pictures, checklist, or any other documentation of the original condition of the rental unit before the lease term began.
- A tenant must return the keys to the rental unit to the landlord immediately after vacating the property.