There are two types of tenancy agreements that an owner and a tenant can enter into. The first is a fixed- term agreement and second, a periodic tenancy agreement.
A fixed-term tenancy has a definite commencement date and expiry date. A periodic agreement has a commencement date with no expiry date.
The preferred type of tenancy is a fixed-term agreement where a tenant will enter into a 6 or 12- month agreement to give both parties security of tenancy and income for a set period of time.
Tenancy agreements do not necessarily have to be for a 6 or 12-month term. Sometimes it is best practice to enter into a varied term (i.e. 5, 8 or 10- month tenancy) to avoid the property becoming available in the middle of winter during a quiet time of the year when it can become harder to find a tenant.
While fixed-term tenancies are generally the preferred type of agreement for both tenants and landlords, sometimes it can be beneficial to enter into a periodic tenancy. You can enter into a periodic tenancy at the commencement of the tenancy by stating a move in date with no expiry date, or if a fixed-term agreement is not renewed for a further term, it will automatically revert to a periodic tenancy.
Periodic tenancies can give both parties flexibility in giving notice, as there is no expiry date and notice to vacate the property can be given at any time in accordance with a periodic tenancy notice period. This flexibility is usually requested if the landlord wishes to sell the property or the tenant is looking to purchase a property.
The negative aspect of a periodic agreement from a property investors point of view is that 28 days after a fixed term agreement has expired the owner must give 28 days notice to the tenant if they need vacant possession and the tenant still is only required to give 14 days notice.
You can be assured that if you have your property managed by the team @home we will ensure your best interests are considered and we will negotiate a new tenancy term on your behalf.
