It is most common for a lease agreement term to be fixed for either six months or 12 months, and we are often asked by our owners, “Which length is best?”

The approach that we take will often vary depending on your circumstances. For example, if your property is a long term investment for you, then we will look for a long term tenant with a 12 month lease. This reduces ‘wear and tear’ with tenants moving in and out of the property as well as saving re-letting costs such as advertising. If you are thinking about selling, it may be that a shorter term is more suitable.

If, in either case, the lease was set to expire at an awkward date when it might be more challenging to re-let (for example, December), we may look for an extra couple of months in the initial term, say seven or eight.

The next question is what happens when a lease expires, should we renew the lease into another fixed term agreement, or have it continue as a periodic agreement which goes from month to month? Again, it depends on your circumstances – do you want the security and peace of mind knowing you have a fixed income for a fixed period, perhaps factoring in a small rent increase? Again, this may be advantageous if you are thinking of your property as a long term investment.

Otherwise, it may be that leaving a good long term tenant that looks after your property well on a periodic arrangement is the best for all parties.

Leave a Reply

Your email address will not be published.