13 Month Leases

[Sez]

Hi All,
I just thought I'd mention something that I've been discussing with my landlords and the feedback has been really positive.

13 Month leases. If your property is due for a lease renewal or is being rented out in December why not ask if the tenants would like a 13 month lease? That way you have a tenant on a fixed term agreement over the Holiday period without having to advertise and try to find a tenant when people don't do a lot of moving.

I've had quite a few landlords and tenants take me up on the idea because it offers the landlord some security over a bad time to have an empty property and the tenant is secure that they won't be asked to leave at a horrible time to have to move out!

Be interested if any of you have tried this before, I've done it over the years and it's worked well so far. Better to be renting a property out in January than in December.

 

[INVSTOR]

Yes, I've changed all of mine by doing this. I had one PM who kept telling me she had to rent my unit lower than other units in complex because it was usually available in winter so i got her to change lease to end in January. Especially having a couple of properties with pools January is a good time to renew leases.

 

[callander]

This works great & we do this often. No one wants a property vacant over Christmas.

 

[travelbug]

Yes people think you have to have 6 or 12 month but you can do any number months (up to 24 I think).

Just do what suits you (as people said- take it out of a bad time for renewing leases).

 

[HD_ACE]

I did this last year for one renting in december. Offered them a lease of 10 months or 14 months to avoid the bad time. They chose 14 months so worked well.

Cheers

 

[jenni_nextplace]

Yeah have always done this but doesn't only just apply to Christmas period.

The same principle applies for busy and non busy periods. You can negotiate a lease to any end date that you like. Several reasons why you would want to control your lease end dates.

1. Don't let lease end dates fall in December or Jan. Generally a difficult time to re-let and to find tradesmen and cleaners to attend to vacate issues. Everyone is on holidays.

2. Try to arrange leases to end in peak periods, you are then more likely for quick turn around and much higher rents.

3. Don't let leases end in slow periods. Long vacancy and lower rents.

4. Leases ending at busy times can be stressful. E.G End of financial year.

5. Also consider public holidays you don't want a lease to end on a long weekend as you will have a longer vacancy.

6. Also pick lease end dates. Don't end a lease on Friday, Saturday, Sunday. Wednesday is a good day for a lease to end. Gives you a couple of days to tidy up the property for a new tenant and tenants generally want to collect keys on Friday, to move in First thing Saturday morning.

 

[Colin Rice]

Yeah have always done this but doesn't only just apply to Christmas period.

The same principle applies for busy and non busy periods. You can negotiate a lease to any end date that you like. Several reasons why you would want to control your lease end dates.

1. Don't let lease end dates fall in December or Jan. Generally a difficult time to re-let and to find tradesmen and cleaners to attend to vacate issues. Everyone is on holidays.

2. Try to arrange leases to end in peak periods, you are then more likely for quick turn around and much higher rents.

3. Don't let leases end in slow periods. Long vacancy and lower rents.

4. Leases ending at busy times can be stressful. E.G End of financial year.

5. Also consider public holidays you don't want a lease to end on a long weekend as you will have a longer vacancy.

6. Also pick lease end dates. Don't end a lease on Friday, Saturday, Sunday. Wednesday is a good day for a lease to end. Gives you a couple of days to tidy up the property for a new tenant and tenants generally want to collect keys on Friday, to move in First thing Saturday morning.

Fantastic tips

 

[MIW]

+1.
I do similar things with my agents, as suggested above.
They don't have to be 6 or 12 months, they can be anything, even 3, or 4 or 7 or 9 months, etc..... You can actually decide the months they end on.
I never have a lease ending in Dec, Jan but other months seem to work for me!

 

[westminster]

You can also use it to stagger your lease ends. For example, one completion of build I had 3 villas lease at the same time for 12mths so they fell due for renewal at the same time. Eeek. Luckily only one villa wanted to leave but it taught me to stagger it so that wouldn't happen again.

 

[Sez]

I'm glad it's being used. A lot of my landlords had never even thought of it thinking that it had to be 6 or 12 month leases only!

I guess I just wanted to make sure everyone was getting all of the info!

 

[wylie]

We've also done this for many years, ended the initial lease in mid January. That means strange number of months (certainly not a standard six or twelve) and then we try to end all leases mid to late January.

I'm curious about those who say to end leases in February. I've heard this before, but I try to end them mid January because I figure anyone wanting to find a house before the school year starts will be looking as soon as the new year ticks over. (It might mean the kids start school before the family actually moves into the house, but at least they have contracted on the right house in the right area for the chosen school.)

 

[Sez]

We've also done this for many years, ended the initial lease in mid January. That means strange number of months (certainly not a standard six or twelve) and then we try to end all leases mid to late January.

I'm curious about those who say to end leases in February. I've heard this before, but I try to end them mid January because I figure anyone wanting to find a house before the school year starts will be looking as soon as the new year ticks over. (It might mean the kids start school before the family actually moves into the house, but at least they have contracted on the right house in the right area for the chosen school.)

I was wondering the same thing. I find Mid to Late January works well here because school starts back in February and people want to be in the house before school where possible .

 

[Ausprop]

what's the length of time for a lease when the provisions of the RTA change? is it 24 months?

 

[Sez]

In VIC you can have a residential fixed term lease for up to 5 years before the rules change. If over 5 years then the residential tenancies act no longer applies. You would either need to see a solicitor to draw up leases for anything over 5 years fixed term OR have a clause in the lease that either party can terminate the agreement at any time as long as they provide (for example) 120 days notice. I feel this makes it pointless to have such a long fixed term.

I'm not sure what the maximum fixed term is in other states.

 

[PrimeProperty]

Sez

Ensuring that leases (where possible) do not expire in mid to late December is best practice property management and we have been taking this approach for years.

January is the peak time for leasing, it sees the most tenants looking which leads to higher rents and lower vacancy periods and a greater selection of tenants for landlords.

We prefer to have the leases expiring in January as opposed to February as the tenant demand drops off considerably in February.