We have found that not all property investors see the advantage of renewing their tenant’s lease agreement.
However as property management specialists, we know it makes good financial sense to try and keep a good tenant in your property for as long as possible.
Here are some of the reasons why it pays to renew a tenant’s fixed term lease:
- Allows you to budget for regular and ongoing rental income.
- Minimises or avoids vacancy periods meaning more income is achieved in the longer term.
- Reduces wear and tear resulting from one tenant vacating and another moving in.
- Avoids the worry of finding another good tenant who looks after your property and pays on time.
Current legislation dictates it is up to the tenant to decide whether or not to sign a new lease agreement. With your consent, we can approach your tenant prior to the lease expiring to discuss lease renewal arrangements. If your tenant is out of a fixed term agreement, we will contact them to negotiate the signing of a new fixed term lease agreement. We will also contact you to discuss your needs and suggest a lease term and rental amount tailored to the current market conditions.
Should you wish to enter into a new lease with your current tenant, we will utilise all avenues at our disposal to ensure the lease is signed. We will inform your tenant that by entering into a fixed term lease we can guarantee them security of tenure for that term. We will also explain that if they were to remain on a continuing tenancy, we cannot provide that same guarantee.
In some instances the offer of a moderate increase in rent as opposed to a higher increase may be enough to entice a tenant who indicates they aren’t renewing to sign the new lease agreement and give you peace of mind.
Should you have any questions, please contact your Property Manager to discuss lease and rental terms for a renewed lease term.