Tenant Wants to Leave Early with Only 28 Days' Notice on 12-Month AST Without Break Clause :(

doodling

Hi,

Gary_Laurus said:

Hello fellow landlords ,

I'm currently facing a situation with my tenant and could use some advice. The tenant is on a 12-month AST without a break clause, which ends on October 28th, 2023. As agreed in the contract, I inquired 2 months before the end of the AST about their plans post-contract. They informed me on August 30th that they would be leaving on September 27th to go back abroad due to personal reasons, giving only 28 days' notice.

I'm currently abroad, 6000 miles away, so this is both expensive and inconvenient for me. I immediately started advertising the flat on OpenRent. The flat is priced below market value, and I've received 15 inquiries in just 10 days. However, none of the inquiries meet the 2.5x rent for salary requirements; some are students, and some are on benefits. I've also told the tenant that they can introduce a new tenant as an option.

I've informed the tenant that they are liable for rent until the end of the AST or until a replacement tenant is found. I'm trying to secure a new tenant to avoid making a costly trip back to the UK. I've had bad experiences with letting agents in the area and can't find anyone reliable to receive the keys on September 28th.

Additionally, I've spent £200 on a full clean-up of the one-bedroom flat. The tenancy agreement requires the tenant to leave the flat in the same clean condition. I have concerns that they won't comply.

My questions are:

1. If it comes down to holding the tenant liable for the final month's rent (which I've never done before and feel terrible about), what's the best way to go about it? Should I deduct it from their deposit or ask them to pay as usual on the rent due date?

2. Are they also liable for other bills like council tax, electricity, and gas until the end of the AST or until a new tenant moves in?

3. Is there a way to recoup the £200 cleaning expenses if the tenant fails to leave the flat in the required clean condition?

4. Given that none of the inquiries meet the salary requirements, what are my options for securing a qualified tenant?

Any advice would be greatly appreciated.

Thank you.

You need to decide what you are doing about the tenancy.  Are you agreeing that the tenancy ends when the tenants notice claims it ends or are you saying their notice is invalid and assuming that the tenancy continues until the end of the term?  That choice guides your actions.

If you are saying that the tenancy continues untill the end of the term then the tenants should pay rent as normal for the final month of the term and they get their deposit back at the end of that month (minus any deductions).  The tenant would be liable for bills and council tax until the end of the term.  You MUST act as if the tenancy remains in force i.e. you have no access to the property until the end of the term, otherwise the tenancy would be considered ended by mutual consent and you are liable for bills/ council tax from the time you treat the tenancy as ended by gaining access.

If you are agreeing that the tenancy ends when the tenants notice says it does then they should pay the rest of the rent for the term when their notice says the tenancy ends and receive their deposit back (minus deductions) at that time.  You are responsible for bills / council tax from the point the tenants notice says the tenancy ends and have access to the property from that point.

The fact that you live a long way from the property is irrelevant, no matter how much that inconveniences you - landlords are expected to be local and noone would entertain a claim for costs because you live a long way away.

Your reference to £200 you have already spent (presumably before the tenancy started) is also irrelevant.  You are entitled to be compensated for the difference in cleanliness between when the tenants moved in and when they moved out.  You will need evidence of the state of the property at both of those times in order to stand any chance of obtaining that compensation from the deposit.

With respect to obtaining a replacement tenant, your property must be unusual in being in one of the few areas where there is an oversupply of rental properties.  In order to get a tenant you need to target marketing at the right demographic for the location, property and price - agents are good at this.  It is of course possible that the location and property are not consistent with the price you are hoping for.

Practically, if the tenants decide to leave the country without paying you everything you think you are entitled to then the chances of getting anything from then beyond the rent and deposit they have already paid are virtually zero, unless you happen to be well versed in the legal system of whichever country they have moved to and that system permits the enforcement of uk debts.

gazfocus

Obviously if they leave before the end of the AST, you can deduct any remaining rent due from their deposit, however, the ideal situation would be to have them pay the final months rent as normal followed by the return of their deposit in full once they vacate. 

Regarding using OpenRents referencing to vet tenants, I would strongly advise against relying solely on OpenRents referencing. We have just used OpenRent for the first time and we ask for 3 months of bank statements, etc, from anyone that puts in an application. We then use those to decide which applicant to proceed to referencing. 

Our applicants went through OpenRent comprehensive referencing and when asked to use open banking to verify their income, they declined to use open banking. As a result, OpenRent had zero insight into the applicants affordability, and the applicant still ‘passed’ referencing. The applicant is self employed so put his own business and email address for the employment reference (so confirmed his stated income himself). OpenRent did not tell us that the applicant refused open banking (thankfully the applicant told us), so had he not told us, we would never have known that OpenRent had no data to assess the applicants affordability. It was only because we had already vetted the applicant prior to referencing that we were confident enough to offer the applicant the tenancy.  

_Penny_Dreadful

Grumpelstiltskin said:

I cant see where the OP has answered the question about what UK address he has given the tenant.

I hope he has given the tenant a valid UK address otherwise he could be stirring a Hornets nest. 

For an AST the address for the serving of notices must be in England or Wales. An address in Scotland or Northern Ireland does not suffice. 

grumiofoundation

Gary_Laurus said:

_Penny_Dreadful said:

Gary_Laurus said:

Hello fellow landlords ,

I'm currently facing a situation with my tenant and could use some advice. The tenant is on a 12-month AST without a break clause, which ends on October 28th, 2023. As agreed in the contract, I inquired 2 months before the end of the AST about their plans post-contract. They informed me on August 30th that they would be leaving on September 27th to go back abroad due to personal reasons, giving only 28 days' notice.

I'm currently abroad, 6000 miles away, so this is both expensive and inconvenient for me. I immediately started advertising the flat on OpenRent. The flat is priced below market value, and I've received 15 inquiries in just 10 days. However, none of the inquiries meet the 2.5x rent for salary requirements; some are students, and some are on benefits. I've also told the tenant that they can introduce a new tenant as an option.

I've informed the tenant that they are liable for rent until the end of the AST or until a replacement tenant is found. I'm trying to secure a new tenant to avoid making a costly trip back to the UK. I've had bad experiences with letting agents in the area and can't find anyone reliable to receive the keys on September 28th.

Additionally, I've spent £200 on a full clean-up of the one-bedroom flat. The tenancy agreement requires the tenant to leave the flat in the same clean condition. I have concerns that they won't comply.

My questions are:

1. If it comes down to holding the tenant liable for the final month's rent (which I've never done before and feel terrible about), what's the best way to go about it? Should I deduct it from their deposit or ask them to pay as usual on the rent due date?

2. Are they also liable for other bills like council tax, electricity, and gas until the end of the AST or until a new tenant moves in?

3. Is there a way to recoup the £200 cleaning expenses if the tenant fails to leave the flat in the required clean condition?

4. Given that none of the inquiries meet the salary requirements, what are my options for securing a qualified tenant?

Any advice would be greatly appreciated.

Thank you.

What was the plan if the tenants decided to leave 28th October? 

Legally the tenants owe rent to the end of the fixed term and will be liable for the council tax.  If you agree a mutual surrender of the tenancy then their liability for rent and council tax until the tenancy is surrendered. 

£200 for cleaning sounds like a lot.  If the tenants leave the property less clean that it was at the start you can deduct the money from the deposit. The tenants can challenge the deduction through the deposit scheme and you’d need to provide evidence that any deduction is reasonable. 

If you’ve started advertising the property how are you planning to conduct viewings or vet tenants if you’re 6000 miles away? What address for the serving of notices in England or Wales have you provided the current tenants with? 

Thank you for your insights. To answer your questions:

1. If the tenants decided to leave on the 28th of October, the plan was to either renew the contract or find a new tenant, as per the usual process. The tenant was informed 2 months before the end of the AST about their responsibilities, which is in line with the contract terms.

The first plan doesn't make sense if they decided to leave the contract wouldn't be renewed?

Not sure what you mean about contract term - many contractual terms in tenancy agreements are not enforceable

2. I appreciate the clarification on the legal aspects. I've informed the tenant that they are liable for rent and other bills like council tax until the end of the fixed term or until a mutual surrender of the tenancy is agreed upon.

3. The £200 for cleaning was a comprehensive clean-up of the one-bedroom flat. If the tenants leave the property in a less clean state, I intend to deduct the cleaning costs from the deposit. I understand that they can challenge this through the deposit scheme, and I'm prepared to provide evidence to justify the deduction. 
As said it doesn't matter how much you spent on cleaning. It is only the condition when they moved in (assume you have evidence of this) and condition when they leave.

4. As for advertising and viewings, I've been coordinating with a friend in the UK for now, although it's not a long-term solution. I used OpenRent's reference checking for vetting tenants. The address for the serving of notices has been provided to the current tenants as required by law.
Why don't you have a letting agent?
 I would get one ASAP

Your points about enforcement and practicality are well-taken. I'm currently exploring all options to ensure that the terms of the AST are upheld while also being fair to both parties.

Thank you for your valuable advice; it's much appreciated.

Put some comments above. 

As said I don't understand why them leaving 1 month earlier is such a massive issue, many of the problems would have also been the case on 28th october.

Simplest solution might be to offer them mutual surrender on 28th if they pay rent but you will cover bills - meaning agent can organise viewings cleaning etc.


You can deduct unpaid rent from deposit if they refuse.

propertyrental

Gary_Laurus said:

,,,, The tenant is on a 12-month AST without a break clause, which ends on October 28th, 2023. As agreed in the contract, I inquired 2 months before the end of the AST about their plans post-contract. Pretty irrelevant  They informed me on August 30th that they would be leaving on September 27th to go back abroad due to personal reasons, giving only 28 days' notice.

Legally meaningless. They can leave on/before Oct 28th without any notice and tenancy will end.

I'm currently abroad, 6000 miles away, so this is both expensive and inconvenient for me. Managing a tenancy at distance is always difficult. Managing from abroad, moreso. Managing without a local agent, family, friend, nigh on impossible

 I immediately started advertising the flat on OpenRent. The flat is priced below market value, and I've received 15 inquiries in just 10 days. However, none of the inquiries meet the 2.5x rent for salary requirements; some are students, and some are on benefits. I've also told the tenant that they can introduce a new tenant as an option.

Without a local agent how do you plan to interview? Qualify? Finance check? Select

I've informed the tenant that they are liable for rent until the end of the AST or until a replacement tenant is found. And presumably cover your earlier tenant find costs too? I'm trying to secure a new tenant to avoid making a costly trip back to the UK. without a local agent this is high risk.

I've had bad experiences with letting agents in the area and can't find anyone reliable to receive the keys on September 28th.Family? Do you have (working) keys? Keys through door?

Additionally, I've spent £200 on a full clean-up of the one-bedroom flat. Why on earth? This is premature and should done when the tenancy ends, not before. 

The tenancy agreement requires the tenant to leave the flat in the same clean condition.Irrelevant. There are rules governing this which the tenancy cannot over-rule.

 I have concerns that they won't comply. Well that's why you hold a deposit.

My questions are:

1. If it comes down to holding the tenant liable for the final month's rent (which I've never done before and feel terrible about), what's the best way to go about it? Should I deduct it from their deposit or ask them to pay as usual on the rent due date? They should pay on usual payment dates. Failing that, deposit deduction.

2. Are they also liable for other bills like council tax, electricity, and gas until the end of the AST or until a new tenant moves in? Until the tenancy ends on Oct 28th or earlier if a new tenancy starts.

3. Is there a way to recoup the £200 cleaning expenses if the tenant fails to leave the flat in the required clean condition? Assuming the cleaning was required (dependant on state of cleaning shown on check-in inventory), and cost was 'reasonable', then yes-deposit deduction. You'll need a check-out inspection, ideally via a member of The AIIC (Association of Independant Inventory Clerks)

4. Given that none of the inquiries meet the salary requirements, what are my options for securing a qualified tenant?employ an agent. See below.

Post 9: Letting agents: how should a landlord select or sack?

Who does the tenant pay rent to? You directly?
If yes, have you obtained HMRC consent toreceive the rent gross? If not rent should e paid et of your tax

Has the T got a address in Eng/Wales ' for serving notices' on you?

theartfullodger

propertyrental said:

Gary_Laurus said:

,,,, The tenant is on a 12-month AST without a break clause, which ends on October 28th, 2023. As agreed in the contract, I inquired 2 months before the end of the AST about their plans post-contract. Pretty irrelevant  They informed me on August 30th that they would be leaving on September 27th to go back abroad due to personal reasons, giving only 28 days' notice.

Legally meaningless. They can leave on/before Oct 28th without any notice and tenancy will end.

I'm currently abroad, 6000 miles away, so this is both expensive and inconvenient for me. Managing a tenancy at distance is always difficult. Managing from abroad, moreso. Managing without a local agent, family, friend, nigh on impossible

 I immediately started advertising the flat on OpenRent. The flat is priced below market value, and I've received 15 inquiries in just 10 days. However, none of the inquiries meet the 2.5x rent for salary requirements; some are students, and some are on benefits. I've also told the tenant that they can introduce a new tenant as an option.

Without a local agent how do you plan to interview? Qualify? Finance check? Select

I've informed the tenant that they are liable for rent until the end of the AST or until a replacement tenant is found. And presumably cover your earlier tenant find costs too? I'm trying to secure a new tenant to avoid making a costly trip back to the UK. without a local agent this is high risk.

I've had bad experiences with letting agents in the area and can't find anyone reliable to receive the keys on September 28th.Family? Do you have (working) keys? Keys through door?

Additionally, I've spent £200 on a full clean-up of the one-bedroom flat. Why on earth? This is premature and should done when the tenancy ends, not before. 

The tenancy agreement requires the tenant to leave the flat in the same clean condition.Irrelevant. There are rules governing this which the tenancy cannot over-rule.

 I have concerns that they won't comply. Well that's why you hold a deposit.

My questions are:

1. If it comes down to holding the tenant liable for the final month's rent (which I've never done before and feel terrible about), what's the best way to go about it? Should I deduct it from their deposit or ask them to pay as usual on the rent due date? They should pay on usual payment dates. Failing that, deposit deduction.

2. Are they also liable for other bills like council tax, electricity, and gas until the end of the AST or until a new tenant moves in? Until the tenancy ends on Oct 28th or earlier if a new tenancy starts.

3. Is there a way to recoup the £200 cleaning expenses if the tenant fails to leave the flat in the required clean condition? Assuming the cleaning was required (dependant on state of cleaning shown on check-in inventory), and cost was 'reasonable', then yes-deposit deduction. You'll need a check-out inspection, ideally via a member of The AIIC (Association of Independant Inventory Clerks)

4. Given that none of the inquiries meet the salary requirements, what are my options for securing a qualified tenant?employ an agent. See below.

Post 9: Letting agents: how should a landlord select or sack?

Who does the tenant pay rent to? You directly?
If yes, have you obtained HMRC consent toreceive the rent gross? If not rent should e paid et of your tax

Has the T got a address in Eng/Wales ' for serving notices' on you?

Not UK, narrower than that.  Assuming property is in England or Wales address provided must be in England or Wales.

Landlord or agent may also be required to provide landlord's ACTUAL address (eg as when i lived in Scotland).

Tenant may leave any date time they choose - eg 5 minutes after moving in...

But may remain liable for the rent.  

Surprising how many don't understand this... (landlords, agents,tenants ..)

SDLT_Geek

OP will also need to have agreement from HMRC for the tenant to pay rent gross of tax, otherwise for an overseas landlord the tenant should deduct tax at source.  There is guidance on the Non-resident Landlord Scheme here: https://www.gov.uk/guidance/paying-tax-on-rent-to-landlords-abroad  It includes the following:

"You don’t need to deduct the tax if HMRC has told you in writing that the landlord can receive the rent with no tax deducted, but you must still register with HMRC and complete an annual report."

GDB2222

How long do you intend to stay abroad?

JohnTravoltage

I have a few questions:

1. If the deposit goes into dispute with the deposit protection scheme's ADR process, does the adjudicator permit deductions from the deposit to cover for the tenant's rent liability for the full AST duration beyond their early exit, or does the dispute process restrict itself to damages to the property? 

1a. If the former, do they restrict it to the duration when then property was vacant until the next tenant was found (which is reasonable) or do they award for the full duration of the early exit (though it's quite likely the deposit may not cover for the full duration if the tenant leaves more than 4-6 weeks early)? 

2. Also, can the adjudicator enforce the tenant to prove that they've closed their utility accounts with the final meter readings taken on the day of their exit? What if they've closed the accounts with readings from 3 months ago, for instance? How does a landlord protect themselves from fraud of this sort?  

3. What if the inventory report isn't signed (but acknowledged by the tenants over email)? Is that valid as a document for the deposit dispute? 

pinkshoes

I don't think you've fully researched this landlord thing properly.

The tenants do not HAVE to give you notice to move out at the end of the 12 months. It's just polite to do that. So at least this way you know they intend to move out, so that's a good thing.

I'm assuming you protected their deposit and gave them written confirmation where it has been protected? 

I'm also assuming the flat has the relevant safety certificates required for renting?

You NEED an agent or friend or someone to manage the property for you. By law you need to give the tenant a UK address to serve notice. How can you do this without a UK agent or someone managing the property??

You may have had a bad letting agent experience before but I suggest you do some homework and find a better one. Try a smaller one with fewer properties to look after perhaps? Or pay a friend to manage it??