A lease is a contractual agreement between two parties, the lessor (owner of the property) and the lessee (the one who will be using the property), where the lessee pays the lessor for the use of an asset. The asset can be property, buildings, vehicles, or industrial or business equipment. A lease is a legal and binding contract that sets forth the terms of rental agreements in real estate and real and personal property. The terms of the lease agreement are enforceable by all parties under the contract law of the applicable jurisdiction.
Leases can be for a fixed period of time or periodic (most often a month-to-month lease) . The most common form of real property lease is a residential rental agreement between landlord and tenant. The right to possession by the tenant is sometimes called a leasehold interest. Leases can be verbal agreements but are normally drawn up in writing. Both parties agree to the terms of the lease, which typically include the property address, the length of the lease, the amount of rent, and the security deposit.
There are different types of leases, but the most common types are absolute net lease, triple net lease, modified gross lease, and full-service lease. The structure of a lease is influenced by the lessors preference, as well as the current trends in the market. Some leases place the burden on a tenant while others put the entire load over to the property owner.
