Tenant problem at end of contract

msdevon

Hi, I let out a house via an agent for 6 months on a find only basis ie the agent found the tenants, did the paperwork and then did the renewal paperwork at the end of the term. All other management issues are dealt with by me.
2 months before the end of the 6 month term the tenants were asked if they wanted to renew and they said yes. They then subsequently objected to paying the renewal fee levied by the agent but which was quite clear in their original agreement. They spoke to me about it and asked if they could go to a rolling over contract where they have no set period and just go from one month to the next. I said no as I am intending to spend a lot of this year abroad and do not want the hassle of reletting at short notice. I also wanted some sort of security of income for a while. Eventually I offered them a one year contract so they would only have to pay this fee every year and not every six months. I told them that this fee does not come to me and in fact I also pay a fee to the agent.

To cut a very long story short they have failed to send in the paperwork by the renewal date and have now told the agent, some 2 weeks after the renewal date, that they will not sign an agreement and are thinking of moving. Where do I stand in all this? Are the tenants entitled to stay in the house with no contract even when I have expressly said I do not want a rolling agreement. Surely if they do not want to renew they should vacate the property. The agent (who has been fairly useless all through even before this latest hiccup and I will not be using them again) just said let it roll on even though its against my wishes.

terryw

If the contractual tenancy has come to an end then the tenant is now on a statutory tenancy and needs only give one clear months notice.

terryw

neas

You sound like a selfish landlord.

You want someone to pay 100 quid evevery 6 month to rent your flat? This will obviously increase the monthly 'rent' of the people living there. And this is what annoyed the tenants.

As they didnt sign a new agreement they have to give 1 month notice. I hate the 'rearrangement' fee which is stupid on all counts....

silvercar

Are the tenants entitled to stay in the house with no contract even when I have expressly said I do not want a rolling agreement

.

Yes, unless you take steps to evict them.

Once the fixed term ends the contract becomes a periodic AST. To remove them you need to serve a section 21 notice giving 2 months clear notice to end on a rent day. If they wish to leave they need to give you 1 months notice to end on a rent day.

princeofpounds

Firstly, I'd suggest you take some time to educate yourself on how to be a landlord. You don't seem to know the basics. I'm not being harsh, that's just a fact.

Secondly, I cannot understand why you permitted your agent, who provides a service for you and not your tenant, to force a charge on them which has little basis in reality. It is hard enough to justify these charges at the beginning of a tenancy (credit check excepted). It is insulting to demand them for doing no more than changing a date on a contract and it seems bizarre to insist on it at cost to yourself. Who is the boss here, you or your agent? You should have negotiated to amend your terms of business as the agent took both of you for a ride on this one if they are on a % as well.

Thirdly, your tenants are doing *nothing* wrong. You proposed an unacceptable deal. They are now seeing out their tenancy obligations. The rules are:

- They can leave with no notice on the final day of their tenancy, or give you a month's notice to coincide with a rent period if they stay beyond that (forming a statutory periodic tenancy - google it).

- You must give them two months notice to leave with an appropriately worded section 21 notice. This is only if you have appropriately protected their deposit.

- You cannot conduct viewings without their consent.

mark5

If they are good tenants who pay rent ontime etc,why not pay the fee yourself as a goodwill gesture if they agree to sign a new contract. One week with no tenant/rent will probably cover the £100 fee.

Soot2006

LOL
I think we had these tenants here last week asking for advice on how to avoid paying the fee .

msdevon

Firstly, I'd suggest you take some time to educate yourself on how to be a landlord. You don't seem to know the basics. I'm not being harsh, that's just a fact.

Thank you for those few kind words, in fact this is why I paid an agent to do the job for me.

Some points I should make clear:

1.The renewal fee was raised by the tenant as something they knew nothing about. I investigated and found out it was very clearly written about on the paperwork they received before they took up the tenancy (I have read their own copy with them whilst they admitted they 'never read that bit') and they should have factored in this amount to their likely outgoings. Before I let the house I did a trawl of 6 local letting agents and this is the cheapest for the tenant by far. The fee is NOT £100.

2.

You proposed an unacceptable deal.

Whilst I discussed the matter with them, face to face. The standard renewal period is 6 months, the tenants said that they would like to stay for 'several years' so I suggested a one year term so the 'fee' would be paid annually, cutting their comittment by half. They said they thought that that was fair and seemed entirely happy with it, as they said at the time, other agents have other fees which this one doesn't so it worked out cheaper overall. When the meeting ended the deal was entirely acceptable to them
3.When it became clear they did not want to sign the contract I offered to pay the fee for them. They declined.
4. The agent is NOT paid on a % basis so a fee for renewing a legal contract seems fair to me, the agent has no other income from my property. I would have to pay a solicitor to draw up a contract otherwise
5.The date for the end of the previous contract has long gone. Neither the agent nor the tenant told me they would not in fact be renewing until I chased the agent for the paperwork.
6. I asked the question here as I said at the outset I was not happy with the agent and would not neccessarily believe their first answer as in the past they have changed their minds, they are not a small agency either, part of a national chain, just their local staff are rubbish.
7. I had no intention of being a landlord, the house is only let as it failed to sell after 9 months marketing in this economic climate. I am disabled and need some income. I am certainly not out to 'fleece' unsuspecting tenants, that's why I employed an agent in the first place.

Thank you for all your helpful comments.

MX5huggy

Your better off with the T's on a perodic contract, and lets be clear they do have contract it has not ended. The reason is every 6mths they won't be thinking do we want to stay here for another 6mths/year. Lazyness will in all likley hood keep them in paying the rent for alot longer! Also every 6mths you have no idea if the T's are going to vacate on the last day of the contract which is there right. Now they have to give at least 1mths notice, you also have the advantage of being able to get them out in 2mths instead of waiting for the contract to expire.

50plusabit

IMHO !!!!!!!!!!!:D

Your agents obviously did not serve a section 21 at the start of the tenancy, if they had done you would have been able to give them notice when they declined to sign the new agreement.

If I was these tenants I would be upset on having to pay £100 for no reason every six months, let it run on to a periodic tenancy, that they want. In this climate people do not want to tie them selfs in to a 12mth contract.
Also If you as a landlord had told me the tenant that you were going abroad to live, I would be concerned who was going to look after the property and deal with any problems? I would worry if I thought it was the agent.

IMO I would think the tenants are going to do one of two things:-
1 Leave the property on the last day of the tenancy with no notice.
2 Or wait until you serve them with a section 21 to give them 2 months to move out, and if they do not conform to this a further few months and a lot of money later, you are left with an empty house, no idea who is going to be your tenancy and you possibly out of the country.

YOU are the client and as a let only the agent has no further input unless you let him issue a unneeded new tenancy agreement.

tbs624

msdevon wrote: »

Hi, I let out a house via an agent for 6 months on a find only basis ie the agent found the tenants, did the paperwork and then did the renewal paperwork at the end of the term. All other management issues are dealt with by me.
2 months before the end of the 6 month term the tenants were asked if they wanted to renew and they said yes. They then subsequently objected to paying the renewal fee levied by the agent but which was quite clear in their original agreement. They spoke to me about it and asked if they could go to a rolling over contract where they have no set period and just go from one month to the next. I said no as I am intending to spend a lot of this year abroad and do not want the hassle of reletting at short notice. I also wanted some sort of security of income for a while. Eventually I offered them a one year contract so they would only have to pay this fee every year and not every six months. I told them that this fee does not come to me and in fact I also pay a fee to the agent.

So renewing for a fixed term is for *your own* benefit, rather than that of the tenants.

Why should a tenant have to pay what are in effect *your* legal costs, to give you the added security of a new FT, especially when they have said that they would be happy with the periodic tenancy? It's a small cost for you to pay when weighed up against a potential void on your property.

Whether or not you are an intentional LL is irrelevant - it's in your own interest to make a success of the business relationship between yourself and your tenant.There is so little actual work involved in renewing an AST anyway and you can set these sort of charges against your rental income for tax purposes.

msdevon wrote: »

To cut a very long story short they have failed to send in the paperwork by the renewal date and have now told the agent, some 2 weeks after the renewal date, that they will not sign an agreement and are thinking of moving. Where do I stand in all this? Are the tenants entitled to stay in the house with no contract even when I have expressly said I do not want a rolling agreement. Surely if they do not want to renew they should vacate the property. The agent (who has been fairly useless all through even before this latest hiccup and I will not be using them again) just said let it roll on even though its against my wishes.

The tenancy becomes a statutory periodic contract under the provisions of the Housing Act 1988. You are apparently willing to "cut off your nose..." - yes, if you want them out then you serve a S21 notice (presuming there hasn't already been one served and that you have scheme registered the T's deposit, if in E&W) and then proceed to court if necessary, but why not just get that fee waived for your Ts and they'll probably give you the added security of the new FT that you need/want.

IMO this one is not about "principle", it's about you stubbornly refusing to do the maths: think about it - re-advertising, month or two's void, new fees for you to pay out, maybe some redecorating, possibility of a less reliable new T (who may also kick off about nonsense renewals fees) against just paying the fee yourself . You say that the fee is "NOT £100", so presumably it's a lower figure - average that out against your security from that new FT and you're probably looking at around 5 or 6 quid per month (& then remember the offset for tax too) If you trusted the LA to provide you with a decent AST in the first place you could either just reuse the wording from that original FT contract for the new FT , or join the RLA/NLA (LL associations - membership fees tax deductible) and get a decent AST from them

You say that you want to ditch the LA anyway, but if you are going to be non-res in the UK you will need someone to act as an agent, so be aware that T's are heartily sick of LAs ever increasing fees and perhaps try looking at the situations from both sides before trying to enforce these sort of costs onto your prospective Ts.