Which of the following is a potential disadvantage of an escalation clause for tenants?

An escalation clause typically allows the landlord to increase the rent during the lease term according to certain predefined conditions, such as inflation or increased operating costs. This means that while a tenant may initially agree to a set rental amount, they could face rising costs over time as the escalation clause is invoked.

The potential disadvantage for tenants is that their overall rental expenses can become significantly higher than what they initially planned or budgeted for, making it harder to manage their finances as the lease progresses. This unpredictability in rental costs can also affect long-term affordability and budgeting for tenants, who may find themselves in a situation where they are paying much more than they anticipated if rents increase significantly due to the escalation clauses.

In contrast, reduced rent, a stable payment structure, or lower service quality are not inherent disadvantages of an escalation clause. In fact, having the possibility of stable payment structures could be advantageous, and service quality may remain independent of the escalation terms.