Fixed-term Lease

A fixed-term lease is a rental agreement that locks in the terms of your tenancy, including the rent amount and rules, for a set period of time.

Most fixed-term leases run for 12 months, though six-month and 24-month agreements are also common. During that period, your landlord generally cannot raise your rent or ask you to leave without cause, and in return you are expected to stay for the full term. Renters typically encounter a fixed-term lease when they first move into an apartment or when they renew at the end of a previous lease cycle.

For example, if you sign a 12-month lease starting January 1 at $1,500 per month, your rent stays at $1,500 through December 31, regardless of what happens in the broader rental market. If comparable units in your building jump to $1,700 during that year, you are still protected at your original rate until the lease ends.

When the fixed term expires, your agreement may automatically convert to a month-to-month tenancy, or your landlord may offer a renewal. Rules around this transition vary by state and local law, so it is worth reading your lease carefully before the end date approaches.

Breaking a fixed-term lease early can come with costs, typically including a fee equal to one or two months of rent, though specific penalties depend on your lease language and local regulations. If you are unsure about your rights or obligations when ending a lease early, consult a local tenant rights organization or attorney.

Understanding a fixed-term lease matters because it gives renters stability and predictability, making it easier to budget and plan, while also creating responsibilities that can be costly to exit before the term is up.