[We asked our agent some years ago when I first moved to WA whether we could do a 2 year lease as we thought it might be in everyones interest. They said straight up not after talking to the owner they do not do longer than 12 month leases. I would have thought some owners would want the surety of a 24 month lease? Apparently not.]
If you are renting in a reasonably strong market the need to find longer leases is not as high.
1. RISK REDUCTION: If not the tenancy laws, then the govt body overseeing the legislation often seems to be slanted in the tenant's favour. The longer the lease signed with you, the harder it will be to get you out if you are causing trouble. Although you may be very nice in person and have great references, the property manager has just met you and it is safer for them (and the landlord) to take a 12 month rather than 24 month lease.
2. MAXIMISING RETURN: Additionally, in a strong market, we need to keep pace with the rental market. The rent can be increased during a lease IF the amount or a formula for working out the amount of the increase are specified in the lease. It is very difficult to do this for 'market value' as this is not a formula (there was a case in the NT covering this) and determining a market value 12 months in advance is speculation that an ingoing tenant will find difficult to swallow (and move on to the next property) - better to simply do a 12 month lease and asses the market in 12 months time - no speculation - no argument.
3. FLEXIBILITY: We just don't know what is around the corner. A landlord's situation may change and they may need to move in or sell the IP. Easier to sell when vacant. This situation is easier for tenants - they simply give notice that they are breaking the lease, pay the rent until a new tenant is found and the break of lease fee and they are out. There is no equivalent for landlords unless a situation has arisen that wasn't in existence when the lease signed that would cause undue hardship on the landlord - I do not know if this section of our Tenancies Act has been tested.
Also month to month rentals which I used to often do in the east after a first 12 month lease don't seem to happen much in WA. Even if it meant paying more in rent it gave me the flexibility if my work changed or I had to move the reason I rent in the first place.
On one occasion we stayed on this month to month for 3 odd years in the one place. The owner was very happy with the extra rent no doubt, I was happy with the flexibility which I did use after three years. Again in WA when my first lease expired and I asked for month to month the agents said they do not do month to month....
Could it just be because of the way agents are paid? Is this possibly a breach in their fiduciary duty to the owner?
Where I have worked before we never charged re-letting fees so there was no direct benefit to us to generally recommend fixed term leases but we did. In Darwin it is VERY tough to rent in the buildup (November/December) which is when people seem to leave town - to start jobs elsewhere in January + a host of other reasons. The likelihood of a tenant leaving during a periodic tenancy during this period is pretty high. Any extra rent is likley to be wiped out on a lengthy vacancy period if vacate occurs during this time unless the owners a) get lucky b) considerably reduce the asking rent. Although you stayed 3 years in 1 place, the point was that it gave you flexibility, so there was no guarantee that you would be there that long.
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I hope the above helps explain what happened.
Kind regards,
Jody