Updated: August 2026
Today, we're going to talk about month-to-month rental agreements. Read on to learn more about the pros and cons of using the month-to-month system with your future tenants.
What Is a Month-to-Month Lease?
First, let's take a quick look at what we mean when we talk about month-to-month leasing. A month-to-month lease is a lease that can be easily renewed or ended on a rolling, monthly basis. Some property managers use them from the start of a leasing agreement, while others allow them to kick in when the original long-term lease, usually 10 to 14 months, expires.
Typically, month-to-month renters don't need to sign a new lease each month. Instead, both tenant and landlord operate on the assumption that the lease renews for another month unless otherwise specified by either party. In Colorado, landlords need a valid legal reason, known as just cause, to end a month-to-month tenancy or decline to renew it. Ending a month-to-month lease for a qualifying reason (like nonpayment or a lease violation) generally requires 21 days' notice, while ending one for a no-fault reason, such as selling the property or an owner moving in, requires 90 days' notice.
Pros of Month-to-Month Rental
Month-to-month rentals can put property managers and landlords in a good position. Let's look at some of the perks of month-to-month leasing.
Flexibility for Both Parties
Having the option to end a tenancy with proper notice provides flexibility that a long-term lease doesn't. This benefits both you and potential tenants who are unsure what next year might look like for them.
One example of how this might benefit a tenant is if they're waiting to hear back on a job offer in another city that may start in a few months. An example of how this might benefit you is that you can choose when to move from a month-to-month agreement into a long-term one, which is especially helpful if you want to start looking for new tenants in the summer, when moving rates are highest.
More Predictable Opportunities to Adjust Rent
A month-to-month lease gives you a more regular opportunity to revisit your rent price than a long-term lease does, since you aren't locked into a single rate for a full year at a time. Colorado law does cap how often and how you can raise rent though: increases are limited to once every 12 months per tenant, and you'll need to give 30 days' written notice for increases of 10% or less, or 60 days' notice for anything larger. So a month-to-month lease gives you a natural checkpoint to reassess rent on a shorter cycle, not the ability to change it repeatedly throughout the year.
More Room to Address Lease Violations
There are limited scenarios in which a landlord can terminate a lease agreement early, and that hasn't changed. What a month-to-month lease does give you is a shorter overall commitment. If a tenant pays late, damages the property, or otherwise violates the lease, you have a for-cause path to end the tenancy sooner than you would with a long-term lease, without waiting out a full year-long term. This still must be done properly, with the right notice and a legitimate, documented reason, since Colorado no longer allows landlords to simply choose not to renew a tenancy without cause.
Cons of Month-to-Month Rental
Many of the pros of month-to-month leasing come with a flip side that isn't quite as positive. Let's look at some of the most important cons of month-to-month leasing that you should consider.
Flexibility Can Lead to Uncertainty
That flexibility we mentioned can work in favor of both you and your tenants. However, it can also create more uncertainty for you as a landlord. In the worst case, you could find yourself facing constant turnover as good tenants decide to leave after only a few short months.
Short Notice Can Lead to Longer Vacancy Periods
With a shorter notice window than a full lease term, a month-to-month agreement can present unique challenges in filling vacancies. You may have less time to start advertising and showing a property, and you might find yourself trying to rent it out during the off-season, when fewer people are looking for a new place to live.
Month-to-Month Leasing Can Create Lack of Stability
Overall, a month-to-month lease can create a lack of income stability for landlords and property managers. If your income is spread across several properties, this may not be a huge issue for you. If you rely on rent from just one or a few properties, that lack of stability can take a real financial toll.
Is a Month-to-Month Lease Agreement Right for You?
Reexamining your current leasing system from time to time is a good habit for any landlord. We hope our guide to month-to-month rentals has helped you weigh the trade-offs.
For our own managed properties, we focus on longer-term leases, since they tend to offer more predictable income for owners and more stability for tenants. If you're weighing your options and want to talk through what's the best fit for your property, feel free to reach out to one of our BDM for a free rental estimate.
