Lease renewal & agents fee

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    Lease renewal & agents fee

    hi

    i've just found this site and i've found looking through the archive very helpful but i am not sure if i have understood some of the advice/option correctly so i'm hoping someone would be able to confirm what i think it is saying.

    i am about to renew a 12 month lease with new tenants (of 12 months) who have been excellent. the agent who found them has contacted my regarding the drawing up of the new 12 months lease. they again want 10% but have stated that this is negotable. i have contacted the tenents to see if they want to renew and although they have vague ideas of getting a house they have done nothing about and the lease is up in march.

    in the archive i found references to letting the original lease run on on a month to month base. is this the case and if so does the agent have any claim given that a new lease is not being drawn up? what are the advantages and disadvantages to doing this? if the lease is extended but not redrawn can i still uncreate the rent to account for inflation. also is there anything else i should take into account when renewing/extending the lease.

    is it reasonable/possible next time to neg for this annual payment to be removed?

    many thanks in advance
    shobden

    #2
    There is nothing in principle wrong with not renewing the tenancy agreement that your agent has set up. The agreement then becomes what is called a statutory periodic tenancy which has the same terms as the original one but with two exceptions. Firstly you can increase the rent if you wish and secondly you can terminate the agreement by giving your tenant two months notice and your tenant can terminate if he gives you one months notice. This may suit you both, however it is important to read carefully the terms on which you appointed your agent and terminate your contract with them if you want to consider proceeding in this way. You have not stated whether these agents merely found you a tenant or are acting in a management capacity which may also affect matters.

    P.P.
    Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.

    Comment


      #3
      thanks pp for your response. my agreement with the agent was for finding the tenent only. i probably should add that i was very happy with the agent and the tenent they found and my question is more my being a neebie. i read the agreement last year and there was a paragraph that i thought ment that the fee was due again the next year but (surprise :-)) it didn't seem to spell it out. however i'm out of town and won't be able reread it till i return.

      again thanks for your feedback

      shobden

      Comment


        #4
        Unless you want to give your tenants a new AST, I suggest you ignore the agent's request and continue to collect your tenant's rent. I am sure you will explain the position to them and ensure that they are happy with it. If your tenants require more security of tenure than the two months they get, then you can either issue your own AST (loads of sources of such documents, just browse this forum!) or get your agent to do so for his large fee.

        I usually use agents to find me tenants but I carefully check any agreement they give me to sign, and delete any reference to renewals of tenancy agreements! There is usually such a sweet smile on their faces when they see me do it as I always make it perfectly clear that "find-a-tenant" means exactly that: I do the keeping!

        P.P.
        Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.

        Comment


          #5
          thanks p.p. the statutory periodic tenancy looks the best option assuming the tenants are happy with that and i havn't signed anything really binding.

          many thanks
          shobden

          Comment


            #6
            This agency question is raised quite often and the introducing agent has no claim on any fee for your tenants renewing the agreement, or if you choose to allow it to continue on a periodic basis.
            As they acted as introducer they then can't go on to say that if it's renewed then a fee is payable as that's clearly an unfair term.
            Last edited by PaulF; 06-02-2005, 18:35 PM. Reason: Poor spelling
            The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

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