When a fixed term lease ends, that's it. You can, of course, send the tenants a polite note reminding them of the approaching end of their time on your premises, but California state law does not require it. (Other states do require 30 days' notice even with a fixed term lease.)

When the lease ends, you and the tenants are back to ground zero: You can rent to whomever you wish. You may decline to offer a renewal to anyone as long as your decisions are reasonable business ones, not discriminatory or retaliatory. In other words, you cannot refuse to rent to a tenant because he or she is of a certain race, religion, and so on; nor because a tenant took advantage of a legal right -- such as complaining to a health inspector about code violations.

If you lived in a rent-controlled city, some of this advice might not make a lick of sense. In rent-controlled cities that require "just cause" for eviction or nonrenewal, unless the second tenant has done something that would justify an eviction, you might have to offer the place to him or her, too. Check your rent-control ordinance for details.