To think 300 quid to renew a rental contract every 6 months is taking the mick

[sideeyes]

New landlord here. Tenants in property for four months on a six-month fixed term lease. I had reason to visit the property this week and was super impressed with how it is being kept and would like to keep these tenants for as long as possible. I use a management company who have said I need to decide if I want to renew contract or not now and have suggested increasing the rent and offering a six month term again. A. I’m not going to increase the rent b. I want to offer the tenants a choice of 6 or 12 months on the lease so they have stability if they want it but c. Apparently doing the new contract will cost 300 quid! I feel like I could do a copy paste job with the old contract as no housing law has changed since January and save myself some money. No wonder they suggest only giving a six month lease as that means they can line their pockets regularly. Any landlords have any tips? TIA

Our landlord does a copy paste job once a year if and when the rent goes up. Don't throw £300 down the drain!

Just let the tenancy roll over.

i thought they had got rid of the charges? Legally your tenants go onto a rolling monthly tenancy so you don’t need to do anything with the rental agreement, so
personally I’d go onto the rolling monthly tenancy and get rid of your management company, find a better one snd
at the point you have found the new one then offer another 6 or 12 months locked tenancy.

The law changed a few years ago and LL's/Agencies can no longer charge for contract renewals. Do some googling and I'm sure you can find the info easily enough - it's a bit worrying that the agency think this is ok, but admirable that you as the LL think it's out of line!

As pp said. Just let it roll over. That's no more or less secure than a new agreement. Explain it to your tenants. They will be pleased because the agent would charge them a few hundred quid too!

Yes the law changed so tenants wouldnt be stung for charges like this.. the managing agents wants to charge the OP who is a landlord to renew the tenancy.

For tenants yes, they passed them to landlords. If anyone should pay them it's landlords but frankly those charges are a licence to print money and are total bullshit.

They can't charge tenants but they can charge landlords AFAIK

You don't need to do anything...they'll go onto a rolling monthly tenancy. Definitely don't pay!.

Yes as others have said it’s normal to be charged as a landlord, and you can’t just drop the management agent and keep the tenants as you will have signed a contract saying if you do that you have to pay them anyway (not sure the exact details but they protect themselves against this for obvious reasons.
But what’s surprising to me is that you were recommended to do a 6 month tenancy. I have a BTL in the south east, and also currently renting temporarily in London, and was told that in London there are no 6 month tenancies (and very rare to even get a 12month with
a break clause) and in my property in the SE I have been able to add a break clause (as it suits my situation) but it’s not standard. In London many agents were talking about 36 or 24 months contracts being preferred by landlords! I suppose it depends where you are and what the market is like - but 6 months does seem like a bad move in this case.
also I don’t know if you know about the new rules coming in (nobody quite knows when) which will mean all tenancies are rolling and LLs have to give 6 months notice, but tenants 2 months - at any time (unless by mutual consent). So it’s going to be all very different this time next year anyway (likely by this autumn).

Do the tenants want a new fixed term, or are they wanting to go onto periodic? Presumably the agents could charge you £300 for writing a contract the tenants have no intention of ever signing? In which case why waste your money?

But if the tenants really want a new contract, then it's more of a case of if you think these tenants are worth paying up for. Or write your own and deal with the fall out from the agents after!

Thank you. Hopefully the tenants will be ok with a rolling contract, but if it were me I would want security. I’m annoyed as I wanted to offer a 12 month lease to start with but was dissuaded by the agents which I feel was so that they could rinse me through this 300 quid charge every six months.

Thank you. Yes, I think I’m all for the changes apart from the amount of arrears that can be accrued prior to eviction. I originally wanted to offer a longer lease to give security but the agents put me off….i think precisely so they could get 300 quid every 6 months….

LL here, as the new renters Rights Bill will come in shortly there will no longer be any fixed term contracts. You would be mad to pay £300 for a new contract that will have to be replaced probably in the autumn anyway. Muchore sense to let it roll on to a periodic tenancy.

You can do a new contract yourself or let it go onto a rolling one

As an ex landlord, definitely just let the contract rollover and there’s nothing stopping you from verbally advising tenants that it’s easier to let it run like this - however as far as you’re concerned you have no intention to be wanting any changes in the next 12 months and are happy with them.

Thanks everyone - great advice

Years ago my landlord and I (when tenants could still be charged) decided after year 1 to just get rid of the agency. We both saved. He trusted me as a tenant. I ended up staying for 9 years and he never put the rent up as I kept the place immaculate. We saved thousands over that time and trusted one another.

do what works for you.