What is a reappraisal lease?

A reappraisal lease is characterized by periodic reviews of the rental level typically conducted by an independent appraiser. This type of lease arrangement allows for the rent to be adjusted based on current market conditions, ensuring that both parties remain aligned with the prevailing rental market value. The independent assessment helps provide an objective evaluation of the property’s worth, making it a fair mechanism for rent adjustments, rather than relying solely on predetermined rates or constant increases. This flexibility can benefit landlords by potentially increasing income in accordance with market demand and also safeguards tenants from excessive or unreasonable rent escalations that might be perceived as arbitrary.

Other options describe different kinds of lease arrangements that do not incorporate the periodic assessment and adjustment of rent based on independent appraisal, which is the hallmark of a reappraisal lease.