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Home > What is the Best Tenancy Agreement Length for Long-Term Landlords?

What is the Best Tenancy Agreement Length for Long-Term Landlords?

Many landlords depend on a steady rent income for their everyday living expenses as well as their pensions, or even to help their children. For these landlords, choosing the most appropriate length of tenancy agreement is a crucial issue.

This article outlines what are the lawful upper and lower limits for the length of the tenancy agreement for the UK. Then, we will look at the things that landlords with long-term leases must be aware of when writing their agreements. As we’ll see, the length of tenancy is a balance act that balances risk and security as well as reward and agility.

The Tenancy Length Law: What Do the law say?

The rules are different across the UK and Wales, which is why England and Wales each having their own laws that is different from Scotland. These are the rules you need to be aware of.
England and Wales

The majority of landlords provide An assured shorthold tenancy (AST). The AST agreements begin with a fixed duration which is usually 12 months, but it could go as long as up to seven or three years. The AST cannot be ended prior to the fixed term being completed, therefore when people talk about the length of tenancy, they typically refer to the fixed term.

After the fixed-term has ended, the tenants are free to leave or you could negotiate an agreement for a fixed-term with them that will range between six months and three years. You can also let the tenancy become periodic. It is also known as”rolling contract”. In this case there is no expiration date to the contract but instead it is rolled forward month-to-month. In a tenancy agreement England and Wales, both parties can send notice to the other party to terminate the tenure.


Scotland utilizes the Private residential tenancy (PRT) agreement instead of an AST. The primary difference is that the tenancy is non-exclusive. It’s an indefinite term. There is no set term. the landlord is not able to simply request a tenant to leave at the end of the term.

The rules , however outline 18 specific situations where landlords can get possession back, for instance, the event that you decide to sell the property or if your tenant has violated the conditions of the contract.

Deciding on the best Tenancy Contract Length

The most important decision for landlords who are landlords in England as well as Wales is what is the tenancy contract length. Since the majority of landlords lease out their properties for a long-term income or investment vehicle, the most obvious decision is to make the contract the longest period feasible. However, long fixed terms have disadvantages that reduce the benefits of security.

The decision is a balance between going long and knowing that you have a tenant and generating income in the long-term as well as cutting down. The shorter option gives you more flexibility , but it also means empty days and can result in having to pay for rental advertisements more frequently.

Benefits of a longer-term agreements

In the event that you’ve got a tenant that would like to stay at your home over the long haul and will prefer the option of a longer-term lease. According to the nonprofit Shelter 90 percent of tenants would like the protection that a longer agreement provides.

Tenants with this kind of relationship are more likely to take maintenance of their home as they are more “invested” in it. the property feels more like a home. Also, you will pay less as drafting one AST and then letting it run for a couple of years is more affordable than renewing every six month or every year. Certain agencies charge hundreds for renewing. Another advantage is that you’ll experience lesser void periods between tenants, which will reduce the time between rent payments being paid.

It is likely that you will have more trust with a tenant who has been in the rental for a long time, which is beneficial since any issues will be more easily resolved. A tenant is also most likely to be able to settle rent on time each month, without falling behind or falling into arrears. This will benefit landlords, with regards to cash flow prediction and relaxed mind.

The disadvantages of agreements with a longer duration

While long-term leases are desirable for a variety of reasons are not without their drawbacks. In the event that you are dealing with a troublesome tenant the issues could last longer. There is a chance that long-term tenants are more demanding. While that’s great for maintaining your property but it also means that they could have a higher level of demands.

One major drawback of long-term leases is the need for rent reviews. Although you can alter the rent of the new tenant, that’s less easy for tenants who are already with a long-term contract. In reality, you can’t raise the rent for an affixed-term tenancy in the absence of an agreement in place to the tenants. This must be included in an agreement as a clause for rent reviews.

If you are planning to increase rent with the same tenant renewing a fixed-term lease, it is important to inform them in advance of when the term expires. This will allow the tenant enough time to consider whether they would like to pay more and remain or go out at the expiration date or leave, and then you’ll have plenty of time to locate an alternative tenant.

In Scotland the landlord is not able to increase rent more than once per year. The tenant has to be given at minimum three months’ notice.

Benefits of a short-term lease agreement’s length

The longer tenancies won’t be suitable for all landlords. While everyone wants to get the best profit from their property investment but some need to be able to relocate quickly if the circumstances change. Short-term leases let landlords be able to quickly sell the property and increase rent. They’re also necessary for landlords who intend to move back into the home on a specific date, for instance the landlord who lets out their home during a time of travel or living in another country.

In the case of a particular the location, there may be a greater demand for shorter-term leases. If this is the case you might be more cautious when reviewing references from tenants and deciding on your prospective tenant. This is especially the case for towns that have significant student population.

Do your homework to determine the length that is ideal for you.

As with everything else associated renting a property research is essential. In order to properly weigh the advantages and disadvantages of the length of the lease be sure to take all aspects into consideration. Make sure to weigh the financial burden and save wherever you are able to. Be mindful of your time and investment in your emotional well-being and being stuck in a two-year lease with a difficult tenant could be as draining of your time as finding a fresh tenant each six-month period.

Being a landlord can be easy The fewer issues you encounter, or the administrative issues you have to manage, can be more important than any additional financial cost.