What is a Periodic Tenancy?

The Renters' Rights Bill will introduce significant changes to tenancy agreements in England. One of the key reforms is the abolition of fixed term assured shorthold tenancies (AST’s).  From the ‘commencement date’ (the date the new legislation becomes effective), ALL tenancies, both new and existing, will become Assured Periodic Tenancies.

Current Tenancy Structures

Currently, landlords and tenants often enter into a fixed-term tenancy, typically lasting between six and twelve months. These agreements provide both parties with certainty regarding the duration of the tenancy. At the end of the fixed term, if no new agreement is made, the tenancy automatically continues on a periodic basis.  This usually aligns with the rent payment schedule and so more often than not, the tenancy automatically becomes a monthly periodic tenancy.

Proposed Changes Under the Renters' Rights Bill

The Renters' Rights Bill aims to simplify tenancy structures:

• Fixed-term tenancies will be abolished: All new tenancies will be monthly periodic from the outset.  There will be no option for a fixed-term agreement.
• All existing fixed term tenancies will automatically become Periodic tenancies once the Act comes into effect.
• Standardising tenancy periods: The Bill mandates periodic tenancies and these will align with the frequency of rent payments.  As it will no longer be permitted to accept more than 1 months’ rent in advance, these periods will be monthly.
• Notice periods: Tenants will be required to give at least two months' notice under the Renters' Rights Bill.  The notice period that a landlord must provide will vary depending on the grounds for possession under Section 8 of the Housing Act.

Preparing for the Changes

To adapt to this shift, landlords should:

• Stay Informed: Understand the full implications of the Renters' Rights Bill and how it affects your obligations.
• Review Current Practices: Review your existing tenancy agreements to confirm they comply with the new requirements introduced by the upcoming legislation.
• Seek Professional Advice: Consult legal experts or join local landlord networks to stay ahead of regulatory changes.

Conclusion

The transition to monthly periodic tenancies under the Renters' Rights Bill marks a significant change for landlords. While this change gives flexibility for tenants, it removes the security for landlords who may find that tenants do not stay for long if their personal or work situation changes and they need to move.

For landlords in the Salisbury, Wilton, or Warminster area, understanding these changes is crucial to maintaining a successful rental business.

Call to Action: If you’re a landlord navigating these changes, reach out for expert advice or join a local landlord network to ensure you remain compliant and prepared. Contact us today for the resources and support you need to succeed.