What is a lease agreement?

A lease agreement is a binding contract for possession of real property in exchange for rent. This legal document establishes the terms and conditions under which one party (the lessee or tenant) is granted the right to occupy and use a specified property owned by another party (the lessor or landlord). The lease outlines crucial details, such as the duration of the tenancy, the amount of rent, payment schedule, responsibilities for maintenance, and other rights and obligations of both parties.

This formalized approach provides clarity and protection to both the landlord and tenant, ensuring that both parties understand their rights and responsibilities during the lease term. It must adhere to relevant laws and regulations, which further emphasizes its binding nature compared to more informal agreements or permissions. Such a structure is essential for preventing potential disputes, as it serves as a legal reference in case of disagreements regarding adherence to the terms.

Understanding the details encapsulated in a lease agreement is vital for both property owners and tenants since it plays a crucial role in the management and rental of real estate properties.