What is the National Apartment Association
The National Apartment Association (NAA) is a national organization encompassing more than 160 state and local affiliates that collectively represent approximately 9.5 million apartment homes throughout the United States. NAA, which was founded in 1917, serves as the leading voice of the rental housing industry, advocating on behalf of apartment owners and operators at both the national and local levels. NAA works to enhance the overall growth and quality of the rental housing industry through research, advocacy, and education. At the national level, NAA advocates on behalf of the rental housing industry on issues such as affordable housing and fair housing that impact the entire multifamily real estate community , including the NAA Lease. The NAA Lease serves as the basis for most state and local apartment leasing forms. NAA Lease forms are developed using the consensus of industry experts to ensure its provisions meet the standards of leading apartment owners and operators. NAA’s member affiliates have built a collective knowledge base of industry best practices to help managers and owners achieve their business objectives. NAA’s suite of documents, forms, and manuals enables members to review and develop policies and procedures that are fair and comply with state and federal laws. NAA’s mission includes promoting programs of recommended best practices in management, maintenance, sustainability, technology, education, and resident screening. NAA members are also provided with access to valuable research and industry data that can be used to position their companies for success.
Overview of the NAA Lease Agreement
The National Apartment Association Lease Agreement (also commonly called the "NAA Lease Agreement") is an apartment rental lease agreement created by the National Apartment Association. The National Apartment Association is a powerful lobbying and advocacy organization for the multifamily housing industry. Many of the largest and most influential apartment owner and management companies in the country are members of the National Apartment Association. In conjunction with 210 affiliate associations, the National Apartment Association has 170,000 participating members who collectively manage approximately 9 million apartment units in the United States.
The use of the NAA Lease Agreement standardizes the rental agreements for renters of apartments throughout the country, creating an even playing field for apartment owners regardless of their respective locations. It helps define and clarify the landlord-tenant relationship. Because it is a nationwide standardized contract, the NAA Lease Agreement is placed in a unique position to protect landlords from governmental regulation and other pressures to conform leases to "form" contracts from the federal, state and local governments.
Key features of the NAA Lease Agreement
The NAA Lease Agreement is designed to protect the interests of both landlords and tenants by clearly outlining each party’s rights and responsibilities. The lease generally includes several key provisions that are important for both sides.
The Lease Agreement typically details the following provisions:
Rent: The method of rent payment and late fees for not paying rent on time.
Security Deposit: The amount of the security deposit and the circumstances under which it can be forfeited or returned to the tenant.
Maintenance: The obligations of the landlord and the tenant as to the maintaining of the property.
Policies: House rules, pet policies, smoking rules, pool hours or other community rules and regulations.
Tenant Obligations: Tenant’s obligations as to guest, holding over, utilities and accepting the condition of the apartment.
Remainder of the Lease: The remaining provisions include the general terms of the lease, parking, move-in procedures, use and occupancy requirements, assignment and subletting, maintenance, obligations on maintenance and repairs, liabilities and limitation of liability, insurance, release of claims, limitations on enforcement, binding effect, default, mechanics liens, subordination of mechanics liens, quiet enjoyment, no warranty by landlord, holding over, severability, entire agreement, waiver, amendment of the lease, amendments required in writing, no oral representations, binding effect, fiscal funding, no recording, exclusivity, landlord right to enter, designation of landlord as attorney in fact, jurisdiction, severability, fax copies, a jury waiver, compensation to the landlord for time incurred by applicant or tenant in the event of litigation or half time incurred by the landlord due to utility cut off.
Why to use a standardized lease agreement
One of the most significant advantages when utilizing a standardized lease agreement like the National Apartment Association Lease Agreement is that it promotes both fairness for the landlord and renter. Renters know all of the obligations (and rights) being agreed to and do not have to worry about hidden, unflattering clauses. Fairness to renters is especially relevant when security deposits are involved. It is also friendly to the owners because it is full of ATRS suggestions that landlords always follow.
The standardized lease agreement is also very transparent and easy to read. The NAA’s lease has recently been updated for transparency and can be readily found online. This particular lease spells out all of the rules with which the renter must comply and the penalties for non-compliance, again, leveling the playing field. This means no more "surprises" for renters. The standardized lease agreement includes a mandatory arbitration clause.
Legal implications in the NAA Lease Agreement
When drafting or negotiating on an apartment lease, most investors or operators are better served using a lease form that contains the protections most commonly required by large or high volume multifamily operators. The National Apartment Association Lease Agreement ("NAA Lease Agreement") is one such apartment lease agreement form.
The NAA Lease Agreement is a very flexible lease form. In its thirteen page (including terms and conditions) form as of the date of this article, it covers most of the key issues that one would want covered for the leasing of a multifamily unit.
It is important to note that even this comprehensive lease form must be reviewed for compliance with the rental laws applicable in the state in which the multifamily property is located. While many rental laws are similar across states, there are also many rental laws that differ from state to state, some quite substantially.
Some lease forms allow for the adding in of additional non-standard terms and conditions. The NAA Lease Agreement indicates that the tenant may negotiate the inclusion of "special provisions" that deviate from the form agreement. Such "special provisions" must be initialed by both the tenant and landlord and may not conflict with the standard provisions which apply regardless of whether a copy of the agreement has been separately signed by the tenant or not.
The NAA Lease Agreement uses bold headings to identify some of the important provisions , and the provisions of the NAA Lease Agreement are arranged according to suggested order of discussion. For example, the NAA Lease Agreement addresses the status of the tenant upon death, including how that status may be affected by a tenant that has died in joint tenancy or other co-tenancy situations.
Both the NAA Lease Agreement and the NAA Lease Agreement for the purchase of units from an owner provide that if the owner is a limited liability company or corporation, then any suit against the owner must be brought against the limited liability company or corporation and not its members/managers or shareholders.
The NAA Lease Agreement for the sale of units from an owner also provides that the members/managers of a selling limited liability company or corporation are not liable for a breach of the obligations of the selling company under the California Law of Limited Liability Companies and the California Corporations Code (with certain exceptions). The NAA Lease Agreement for the sale of units is essentially a membership interest purchase or share purchase agreement.
Modifying the NAA Lease Agreement
Because jurisdictions have different legal requirements, landlords must be careful about customizing this national lease form. The way that apartment leases look and even how they are structured can vary from jurisdiction to jurisdiction. Many states (but not all) also have statutes that provide more legal protections for tenants than does the national form. For example, in some locations rent cannot be collected in cash or there may be restrictions on the types of fees a landlord can charge at the time a tenant takes possession of an apartment like move-in or non-refundable fees. The state law may also require additional disclosures that must be included in the lease.
It is possible to customize the NAA Lease Agreement to add rental terms that comply with the local laws. In many cases, it may be as simple as adding language that complies with the law, but in some cases it may be more complicated, such as where there are state law restrictions on rent increases or late fees. It is important to discuss these types of changes with an attorney, so that you can avoid creating an illegal lease agreement or adopting a lease clause that could be considered to be unconscionable or unfair.
Understanding your tenant rights
As a tenant in a unit covered by the NAA Lease Agreement, your apartment is assured of important rights as a result of these provisions.
For example, apart from any additional rights as a result of state law, tenants have guaranteed the benefit of a safe apartment free from health or safety hazards. If you observe a potentially hazardous or unsafe condition, such as a dilapidated balcony or a torn carpet that could lead to a slip and fall, it is your responsibility to immediately report the condition to management. That way they can make a correction and avoid the possibility of an injury.
If, despite your careful reporting, the management does not act in a reasonable period of time, then you have several possible remedies. You may wish to undertake corrective action yourself, which is known as "self-help." Many NAA members do not allow this, however, because the costs associated with the repair can be expensive. The other solution would be to file a complaint in small claims court to ask for reimbursement. Just remember that you cannot withhold rent without a court order, however, because that is a violation of the lease.
How to get a copy of the NAA Lease Agreement
To obtain a copy of the "NAA Lease Agreement", you must (1) pay a one-time membership fee to join the National Apartment Association, (2) be an NAA member or employee of an NAA member or (3) a non-member, but complete the NAA application for approval and agree to its terms. You might also qualify under subsection (4) by being an NAA accredited as set out in the NAA Guidance on Use of Standard Apartment Lease Agreement. Ask your local affiliate for more information since there are many policies and procedures that differ by your affiliate.
The NAA standard form leases are substantially the same. Your local apartment association may make edits to the agreements to comply with your local laws or may have a policy of not making certain changes to the NAA forms. In some apartment communities , the lease will state that an NAA affiliate lease applies.
Unless your local affiliate is part of the National Apartment Association, you will not be able to obtain an NAA standard lease agreement from the national organization. NAA affiliates own all rights to their respective leases, including the NAA model forms.
