We live in uncertain times and given the current situation It is important to be well informed before reviewing a tenancy agreement for your property. As a Property Manager, we will explain all the pros and cons of renewing a tenancy agreement and why it is a good idea to take a different approach given the current situation.
When working with an agency or a Property Manager, usually, the AST agreement for renting a room is signed for 6 months. An agreement to rent an entire property is signed for 12 months or more.
The Property Manager or Agent usually encourages and reminds the landlord to renew the tenancy agreement every year. This way the landlord gets to lock the tenant into another six months to a year’s contract and the agency will charge another fee for drafting the new agreement.
What happens if I don’t renew my tenancy agreement?
What you should be aware of is that when your tenancy agreement expires it does not mean that you no longer have a valid agreement. Your old agreement is still valid and will turn into a rolling monthly contract. This means that renewing a tenancy agreement is not mandatory at the end of each period.
With a rolling monthly contract in place now it is easier for you to give notice. You will also be able to evict the tenant easier if the situation requires so.
Due to the current situation and uncertain times, It is best for a landlord not to renew their tenancy agreement and lock a tenant. The probability that people might run out of money is much higher today than it was last year.
If a tenant cannot pay the rent It is best to allow them the opportunity to move out sooner and without further commitments. The alternative is having them in the property and not getting the rent paid.
Signing a new agreement
If you can and house a volunteer and dad here or she is moving out and you will need to sign a new agreement with the tenant, we recommend that you use a periodic tenancy agreement.
There are many tenants that cannot pay the rent on time. Periodic tenancy agreements give the landlord the freedom about giving short notice or evicting the tenant if necessary. You can find an example of such a periodic tenancy contract here.
Have you found this is advice useful?
If you have any further questions or require any assistance with managing your property or finding tenants do not hesitate to get in touch with our team.