The cost of living crisis shows no signs of easing so it’s not surprising that our data has revealed that tenants are staying put for longer, unwilling to risk rent increases and uncertainty over unsecured accommodation.
But at the same time, the government wants to bring in periodic tenancies as the standard and change how tenants are evicted, as proposed within its Renters Reform White Paper.
These changes are not necessarily a bad thing. For example, If you suddenly need to regain possession of your property, or decide you want a change, a periodic tenancy speeds up this process as you don’t have to wait until the end of a fixed period.
It will also help to recruit tenants who are on the lookout for a short lease contract, who otherwise wouldn’t be available to you.
For tenants, periodic tenancies mean that they will not have to give as much notice prior to leaving a property, given that the contract will be rolling, but this could present a number of challenges that should be considered by agents and landlords.
Understandably, periodic tenancies are more likely to attract tenants looking for more transient, shorter leases.
Having a high turnover of tenants will not only cost more in terms of referencing and marketing, but it’ll also mean landlords must deal with a shorter turnaround time if a tenant decides to vacate unexpectedly, which will likely increase void periods and cost money.
If your tenant moves out during a ‘notice to quit period, landlords may be liable for paying council tax for the property for that month.
But this can be avoided, by ensuring you have a contractual periodic tenancy agreement in place to ensure this remains the tenant’s responsibility for a given length of time.
With periodic tenancies opening up the rental market to an expanded pool of people, reports of falsified documents and disingenuous applications are on the increase.
Fraudsters are becoming more sneaky at using the tech readily available to them to fake documents and contracts.
Agents must both recognise this as an issue and seek to address it quickly, educating landlords on why thorough checks and due diligence are as important as ever.
Although they come with their own set of challenges, periodic tenancies can be a good idea for all parties, offering increased flexibility and reducing the number of administrative tasks required throughout a tenancy.
The lettings landscape is mid-shift, as a combined result of the pandemic, cost of living crisis and renters reform white paper.
What this means long-term is yet to be seen, but what is certain is that landlords must be vigilant and stay ahead of the ball in order to maintain consistency.
Simon Tillyer is a director of tenant referencing firm Vouch.