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What’s the difference between a periodic rental agreement and a lease?

When renting an apartment or home, you will usually have some type of agreement with the property owner. A common misunderstanding is that a periodic rental agreement and a lease are the same things, but these are two distinct documents.

It is necessary to understand the difference between them because the details of your agreement affect you. While both preserve your legal right to live in the unit, they are different in some key ways.

Periodic rental agreement

A periodic rental agreement, according to the Judicial Branch of California, states the length of time between rental payments, which is the rental period. It expires at the end of each rental period unless you make a payment.

This type of agreement will not state the number of rental periods because it operates from payment to payment. You also have the right to end your rental at the end of each rental period.

The agreement can be oral or written. However, if you have an oral agreement, it must still include a written statement that states the rental period and gives contact information for the landlord.


A lease states the total number of rental periods. Often, a lease will last for one year. The lease binds you to the rental agreement for the full number of rental periods.

A lease offers you more eviction protections, and it freezes your rent for the full rental period unless stated otherwise in the lease. It is also difficult to break a lease without financial consequences.

Leases can be oral or written. If the full rental term is more than one year, then it must be in writing.