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Types
of Tenancy You Must Know
- Fixed Term, Periodic, At Will, At Sufferance
With so
many types of tenancy agreements to choose from, how do you choose the
perfect one? Find out all about the most important and popular types of
tenancy -
periodic tenancy, fixed term tenancy, tenancy at will and tenancy at
sufferance.
To make things easier for you, this guide will give you a brief
explanation with the basic facts on each tenancy type. For more
details,
click on the links for our complete guide on that particular tenancy
type.
Fixed Term Tenancy
As you can tell from the name, a fixed term tenancy that has a
fixed starting and ending date. While these types of tenancy are
usually favoured by landlords wanting to lock in a longer
rental period, you can use it for any duration.
With a fixed term tenancy, both you and your tenant cannot choose to
end the lease single handedly until the end of the rental period.
If both landlord and tenant agree to mutually end the tenancy, they are
allowed to do it anytime they wish. This is known as a surrender of
tenancy.
Before your fixed term rental ends, the only way you can remove your
tenant is when there is a valid reason to evict him such as non-payment
of rent or breaking the terms of your rental agreement.
Periodic Tenancy
A periodic
tenancy has no specific starting or ending date. It
is
ongoing from week to week, month to month or year to year. Week to week
and month to month tenancies are common for residential
tenants while year to year are more popular with commercial landlords.
How often
you collect rent for your periodic tenancy depends on its
type. For example the rent for a week to week lease is collected every
week. If you need a tenancy that gives you rental income
more frequently, then a week to week periodic lease may work for
you.
The
good thing about a periodic tenancy is that it is easier for you to
end it. In most areas, all you have to do is to give your tenant a
written notice to quit 30 to 60 days in advance to end a week-to-week
or month-to-month lease. For a year-to-year rental, you may have to
inform your tenant at least 6 months in advance.
However this benefit is given to your tenant as well so they can choose
to end the rental agreement just as easily. If you are looking
for stable property leases in the long run, then a fixed term
tenancy may suit your
better.
Tenancy at Will
These are more casual types of tenancy where both the landlord and
tenant agree to have a lease but there is no formal written property
lease agreement. There may be an informal written note with the terms
of the lease and rent amount or a tenancy at will may be a pure verbal
agreement.
A tenancy at will is recommended if you are looking for short term
property leases and you have reliable tenants that you can trust.
Ending a tenancy at will is very quick and easy. Most of the time all
you have to do is to inform your tenant 30 days in advance. Although
you can do it verbally, we do recommend that you use a written notice to quit to
prevent any future headaches.
Tenancy at Sufferance
(also known as Holdover Tenancy)
A tenancy at sufferance is rare because these types of tenancy
happen by accident
rather than by choice. When your tenant's rental lease has expired yet
he overstays his welcome and continues living on your rental property.
For a tenancy at sufferance, the tenant has to continue paying you rent
and
follow the rules of the original property lease agreement. The crucial
difference between your tenant at sufferance and trespasser is that he
originally had a legal rental agreement.
One important thing to note is that you are usually not given the right
of self help to remove the renter in a tenancy at sufferance. This
means that
you cannot cut off the electricity or change the locks on your rental
property to chase him away.
Read
what our visitors have to share below OR Scroll down to
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What are Your Favourite Types of Tenancy?
Whether it's the freedom that a periodic tenancy gives you or the stable rental income from a fixed term tenancy, every landlord has good reasons for choosing their type of rental agreement. Share your valuable experience with everyone here - We will love to hear your tips, comments and real life stories:
What Our Visitors Have to Say on Their Favourite Tenancy Type
Click on the links below to read the valuable tips that our other visitors have to share:
How I Choose My Tenancy Type
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Being a landlord and part-time property manager, I strongly believe that the right property lease agreement for a rental property depends heavily on two ...
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