5 Differences Between Commercial and Residential Leases

Leasing real estate is a very common activity that millions of people do every year. Whether you are looking to lease residential or commercial real estate will make a big difference in your rights and responsibilities. Understanding the differences between these two types of leasing will help ensure you engage in this activity properly.

Residential Leasing is Intended for Day-to-Day Living

Residential leases are intended to provide an individual or family with accommodations for day-to-day living. Commercial leasing, however, is not set up to accommodate this type of use. Even if a commercial location has a kitchen and a place where someone might conceivably sleep, this is not the primary use of property leased for commercial use. In fact, some commercial lease contracts will specifically prohibit its use for this purpose.

Commercial Leasing is Intended for Business Use

Commercial leasing concerns the use of space to produce or sell products or services. Commercial leases typically outline the specific types of business operations that may be conducted on the premises. Conversely, residential leases often prohibit the use of the property for any type of commercial activities.

Legal Protections

Residential tenants have many important legal protections that don’t apply to commercial tenants. This is because the legal system generally assumes that both parties in a commercial lease contract are entering the deal on equal footing. The person entering into a residential lease contract, however, doesn’t usually have the requisite legal skill, knowledge, or sophistication that the property owner will likely have. With this in mind, there are laws in place preventing residential landlords from taking advantage of their tenants in many ways.

Length of the Contract

Residential lease contracts tend to be for one year, followed by the option to continue the lease on a month-to-month basis. Commercial leases are generally for longer, usually a minimum of 3-5 years.

Maintenance & Repairs

Residential tenants are ordinarily responsible for very little maintenance and repairs to the premises. If something breaks or needs to be replaced, the tenant only needs to notify the landlord, who will have to take action within a reasonable amount of time. In commercial leases, however, the tenant is often responsible for a great deal more. In many cases, the landlord will only be responsible for maintaining the physical building, while the tenant manages the rest. The specific breakdown of which party is responsible for what will be outlined in the commercial lease.

Legal Help for All Lease Contracts

One thing that both residential and commercial contracts have in common is that they are both important legal documents that need to be taken seriously. Having an attorney available to review or even to write the contract will help avoid conflicts and other problems down the road. Contact the Greenbaum Law Firm, P.A. to schedule a consultation today.

The following two tabs change content below.

Greenbaum Law Firm, P.A.

The Greenbaum Law Firm, P.A. is a boutique, client-centric law firm concentrating in the areas of business and corporate law, contracts and agreements, and real estate. Our unique approach to the practice of law consists of positioning our clients at the center of the legal practice and pursuing their objectives in the most efficient and transparent manner.

Latest posts by Greenbaum Law Firm, P.A. (see all)

%d bloggers like this: