Fixed term extension to tenancy?

[bullybantam]

Hi All,

Got a couple coming up to 6 months on an AST, the default action is of course for tenancy to become periodic.

However they've been good tenants and they've also redecorated. I'd like to offer them a fixed term of two years fixed rent.

Obviously they can leave before hand with one months notice, but the two years would be binding on my part. To give them an incentive to stay full term I'm thinking of offering a cash back.

Can anyone see any obvious pitfalls or any other comments?

Cheers.

[Snorkerz]

So, a 2 year AST with a monthly break clause for the tenant only?

I would be wary of such an arrangement - none of us know what our situation will be in 12 months time - what if you NEED the property back? How about a 6 monthly break clause for the landlord?

Check out the tax implications of the cash back - both for you and your tenant. If LHA is involved then I am sure there will be issues.

[bullybantam]

Thanks Snorkerz,

Fair comment "never say never" as they say. I might just offer them a months free rental if they stay for two years...