In This Guide
Administration
Being a landlord
Buy to let investment
Choosing the property
Finding tenants
Letting property
Lettings agents
Levels of service
Preparing the property
Problem tenants
Tenancy
1. Types of tenancy
2. Resident landlords
3. Duration and termination of the tenancy
4. Rent increases
5. Rent assessment committee
6. Tenancy agreements
7. What they contain
8. Example agreement
9. Other issues
Tenancy
Duration and termination of the tenancy
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Most tenancy agreements are for 6 or 12 months, though some are longer. There is little point in arranging an agreement for less than 12 months, as each change of tenant brings a new set of lettings fees. It is normal to have a 6 month break clause in the agreement, however. Your main aim as a landlord is to minimise the length of time that the property is unoccupied, and longer agreements are better at achieving this goal.
Provided you agree, it is normally no problem for the tenant to extend the term of the let. Make sure that you renew the agreement in writing. If you are using a lettings agent, there will normally be a renewal fee and you will also have to pay lettings agent fees again.
You do not have to agree an initial fixed term with an assured shorthold tenancy. Although the standard minimum duration is 6 months, you can agree an initial period of less than this if the tenant agrees. However, this is pretty pointless as you will not have an automatic right to possession at the end of the agreed period, unless one of the grounds for possession exists. If there are no grounds for possession, the tenant has the right to stay in the property for 6 months, even though you both agreed a shorter initial period.
Both assured shorthold and shorthold tenancies can have two further forms, relating to the duration of the term. Ending the tenancy is not always as simple as you might think, even thought the law has been simplified and weighted more heavily in favour of landlords.
Fixed term tenancies last for a number of weeks, months or years, and are reviewed, terminated or renewed only at the end of such a period. If you agree this type of tenancy, you will only be able to get possession of your property if you have suitable grounds for possession and if the tenancy agreement makes such a provision.
Assured shorthold tenancy agreed on a fixed term basis. You can regain possession at the end of the initial fixed term or any subsequent fixed term without giving any grounds for possession. However, you must give the tenant at least two months notice in writing. You can give this notice during the fixed period, but the notice period cannot end before the end of the fixed term. You can also regain possession during the term if certain grounds for possession exist. Only some of the full list of grounds will convey you this right.
At the end of the fixed term, any replacement tenancy you agree will automatically be on shorthold terms unless you chose to set up a replacement tenancy on an assured basis. If you wish, you can agree a new fixed term or contractual periodic assured shorthold tenancy. If you do nothing, the tenancy will automatically run on from one rent period to the next on the same terms as the preceding fixed term shorthold tenancy. This will continue until you either replace the tenancy, you seek possession of the property, or the tenant leaves. You can also end the tenancy at any point from here on in, by giving two months notice in writing.
Full assured tenancy agreed on a fixed term basis. You cannot seek possession from an assured tenant without appropriate grounds, even when the fixed term ends. Click here to view which grounds convey this right.
Any replacement tenancy that you agree with the tenant will automatically be on assured terms, regardless of what the tenancy agreement says. If you wish you can agree a new fixed term or contractual periodic assured tenancy. As with an assured shorthold tenancy, if you do nothing, the existing tenancy will automatically run on from one rent period to the next on the same terms as the preceding fixed term assured tenancy. In this case, it is called a statutory period tenancy.
Contractual periodic tenancies run indefinitely from one period to the next. With this type of tenancy, you can seek possession at any time under any of the grounds for possession that we have listed on the page listed here.
Under the terms of an assured shorthold tenancy agreed on a periodic contractual basis, you have the right to possession at any time after the first 6 months, provided that you give the occupants at least two months notice in writing. The date on which the notice ends must be the last day of a tenancy period. You can also end the tenancy at any time on the grounds for possession as defined by law. The same applies to a fixed term tenancy that has been allowed to lapse and has turned into a statutory periodic tenancy.
Full assured tenancy agreed on a periodic contractual basis. You can only seek possession when you have grounds to do so, but all of the grounds for possession mentioned here convey such a right.
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