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Joshua
Joshua, Lawyer
Category: Property Law
Satisfied Customers: 26069
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Is it acceptable to offer a short Tenancy agreement monthly

Resolved Question:

Is it acceptable to offer a short Tenancy agreement for a monthly basis to a tenant and then renew each month. (We are selling the house)
Submitted: 2 years ago.
Category: Property Law
Expert:  Joshua replied 2 years ago.
Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

Would this be a new tenant please or an existing tenant already in situ?

Joshua :

Would you also live in the house or would the tenant have sole occupation?

Customer:

Hi Joshua,

Customer:

There are a number of other tenants (3) with three separate rms on periodic assured Shorthold tenancy agreements. I have just acquired exemption from HMO status as the house is on the market

Customer:

This extra tenant, will be new to the property.

Joshua :

Thanks. Will you also live in the property?

Customer:

Sorry I got pulled away

Customer:

I don't live at the property but sometimes stay at the property on visits to London. But it is not my home.

Joshua :

Thanks. Unfortunately your proposal will not work. Based on the long standing legal authority of Street v Mountfort, if the tenant has exclusive possession of a room in the house during his tenancy, the Housing act will intervene and automatically create a minimum of a six month tenancy regardless of what your tenancy agreement may say. In order to exclude intervention of the Housing act, it is necessary either that you live in the house which is likely to be impractical or that you offer serviced accommodation to the tenant. Provision of serviced accommodation excludes the creation of a six month assured short hold tenancy. In order to evidence serviced accommodation, you would need to offer for example a weekly cleaning service for the tenant or provision of meals or laundry service for example a combination. What is important is that whatever services you choose to offer are actually carried out on a regular I would suggest at least weekly basis is of the tenant disputes the position in the future, courts will look at actual practical circumstances rather than what is written down in black and white

Joshua :

providing you genuinely offer serviced accommodation and include such provisions as rights in the tenancy agreement, you can offer the tenant and excluded tenancy agreement and set minimum/maximum terms as you wish. Remeber that notice cannot be less than the interval of rent paid even in the circumstances - e.g. if rent is paid monthly then a minimum of one months notice is required from you to bring the tenancy to an end

Joshua :

Have I been able to help you with all your questions on the above?

Customer:

As it is furnished accommodation can I treat it like a holiday let. Please see my conversation on my last question with 'Alex'.

Customer:

I do appreciate you detailed answer but basically you are saying that I introduce a new tenant into the house even if it is a short let tenancy agreement similar to a holiday let then the courts would not recognize it but give them 6 months minimum term.

Customer:

I have to leave again but will read your answer on my return. Thank you again.

Joshua :

Letting as a holiday let would be very precarious if it is not really a holiday let. The Housing act defines holiday lets as "A tenancy the purpose of which is to confer on the tenant the right to occupy the dwelling-house for a holiday." if the tenant is not really occupying the property for a holiday you leave yourself wide open to a potential dispute by the tenant if he chose to be difficult. Remember the courts look at the situation on the ground not just on what is written down in black and white and if the tenant shows to dispute the position in an effort to remain in the property for longer, you would have your weakest link as your strongest witness against you as the tenant would presumably easily be able to prove that he was not occupying the property for a holiday and on the balance of probability you knew this full well - e.g. if he has a job locacally or is studying and so on.

Joshua :

housing law is relatively strong when it comes to protecting tenant rights and the landlords can easily run afoul of such laws if he does not pick relatively rigidly to the "rules". My view as above would be that renting the property as a holiday let in circumstances where it is clearly or not likely to be a holiday let would leave you exposed to a tenant claiming he has the benefit of a six month tenancy agreement which could lead to further problems of claims against you for failure to protect his deposit and potentially costly and long winded eviction process. You may have cause will get away with it and the tenant may be a delight but there are risks.

Customer:

Thank you thats very thorough. I'm glad I got a second opinion

Joshua :

A pleasure. if you can source a relatively inexpensive cleaner who is willing to call in once a week to clean, you should have little difficulty in renting the room out on a short-term basis as above. Of course it will eat into your profit but you may decide that it is better to rent the room out at a potentially slightly lower net rental than not at all. If you do decide to take a risk then the fully think through the potential impact the worst-case scenario could have upon your sale and whether that risk is worthwhile

Joshua :

I hope your sale goes well in any event

Joshua :

If you have no further questions for now I should be very grateful if you would kindly take a moment to rate my service to you today. Your feedback is important to me. If there is anything else I can help with please reply back to me though

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