Escalation is a term that is used in rental leases and is a clause that allows the landlord to raise the rent in the future. Suppose that you are in the market for a luxurious condo and have located several ideal properties. One of the apartments is much cheaper than the others, and you can rent it for $850 per month. The other condos that you looked at were much more expensive and averaged close to $1000 per month. There is a small hitch because the $850 condo has an escalation clause in the lease. The escalation clause states that the landlord reserves the right to raise the monthly rent by $250 per month. This means that your affordable apartment has the potential to turn expensive at a moment's notice. You decide to rent the $850 condo, and after six months, the landlord activates the escalation clause and raises your rent to $1100.