HI all,
Tenant is finishing a 12-month AST (£1090). I’ve offered a new 12-month fixed term at £1150.
They now want a break clause that can be triggered after 2 months, with 2 months’ notice — which means they could give notice on day one and leave after just 2 months.
They say it’s fair and gives me time to find a new tenant. I see it as a 2-month tenancy disguised as a 12-month agreement.
Would you agree to this kind of clause? Or just stick to a proper fixed term?
TIA
sounds as if they are already looking elsewhere
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This will be a lot of admin for potentially 2 months. It might be easier to let the tenancy become periodic and just increase the rent on the anniversary.
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I wouldn’t bother
If they want a two month let tell them to look on air b and b
They just want a short stay at long term prices
I don’t offer a break clause
They only benefit the tenant
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I agree with Christopher32. Its generally better to let a tenancy go periodic at the earliest opportunity anyway and in this case it seems the obvious answer. Just use a s13 notice to increase the rent.
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Thanks 
— some great input. Just wanted to clarify and ask a few follow-ups:
I’ve always assumed there are significant disadvantages to rolling contracts after a fixed-term AST ends. My current experience confirms that — tenant wants break clauses, may leave early, and can give just 1 month’s notice on a rolling setup. That kind of uncertainty is hard to manage.
A few people mentioned the admin burden of a new AST. But to be honest, I’ve already got all paperwork prepped (How to Rent guide, deposit certs, EPC, etc.), so re-issuing docs isn’t a big issue in my case.
So I’m confused — what are the real legal benefits of going periodic over renewing with a clean 12-month AST? Is it just about convenience, or are there protections for landlords I’m not aware of?
Also curious about the Renters Reform Bill (RRB) — I agree with its direction, but does anyone know if it will apply retrospectively to existing ASTs once it becomes law? (Assuming it hasn’t passed yet.)
What else should I be asking or considering here? Trying to fully understand both sides — especially the risks of going periodic vs. fixed again.
Thanks again
I favour allowing a tenancy to go periodic over renewal because renewal involves serving all documents again with the risk of making an error. Admittedly, Openrent and other online platforms now make the process fool proof. There is also the renewal fee to consider which you don’t have if the tenancy is allowed to run.
Letting Agents will always renew which is more of an excuse to charge the landlord a renewal fee. On paying that renewal fee the expectation is that the tenant would stay for another 6/12 months.
I am not even sure if a two month break clause is even legal on an Assured Shorthold Tenancy (AST). Statute dictates an AST has to be for a minimum 6 months.
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With regard to the Renters Rights Bill it will apply to both new and existing tenancies. Existing tenancies will convert to the new tenancy system.
E.g. If you have an existing tenancy that is still in its fixed term when the RRB comes in, the fixed term clause will no longer apply.
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Fixed terms only favour the tenant. If they want or need to move out and they cant afford to pay rent on 2 properties then what would you do? In reality you wont try to force them to remain in charge of your £x00,000 asset, so in practice its only you that are bound by the fixed term. That also means that you cant serve notice if your circumstances change or the tenancy goes bad.
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Considering the fees associated with installing a new tenant a fixed term is necessary to recoup those fees. Our fixed term is now a minimum 12 months. However in terms of a repeat term I would agree a periodic tenancy is more desirable for the reasons you note.
I have grave concerns regarding the new rules of the RRB of no fixed terms wherein a tenant can effectively move out after only 3 months in occupation thereby leaving the considerable fees as a major burden on the landlord. The only way this can be deemed fair is to allow the reclamation of a proportion of the fees by the landlord.
Furthermore I consider this element to be against the spirit / intentions of the RRB to create security of tenure for the tenant. What exactly is the benefit intended to be to either party other than to allow a tenant the option of a short term tenancy with no penalties.
As the law currently stands, either you’re creating an AST or you’re not - ASTs must be a minimum of 6 months, so this just doesn’t work.
I’d follow advice of others - let it go periodic and raise the rent.
Writing’s on the wall on this one!
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ASTs can be of any length of 1 day or greater up to 7 years. There is no 6 month restriction.
David122
You are a much respected contributor to this forum however I think you are wrong on this one on both counts. The maximum an AST can be is 3 years minus a day. Any longer it has to be a license agreement.
Apologies I got a little mixed up… It is the fixed term element that cannot be longer than 3 years. Obviously, an AST can run indefinitely. Also an AST can be any length although it isn’t recommended to make them shorter than 6 months because you cannot serve a s21 until 4 months to expire at 6 months.
An AST should be the tenants sole residence. Not sure why but assume it is differentiate it from a short term/holiday let.
An AST can be longer than 3 years, but it must then be signed as a deed, not a contract.
As you say, 6 months is the minimum period a tenant can be allowed, although if their AST is shorter than that, it would just become periodic before the 6 months expires.
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If the tenants choose to move out in the last week of the fixed term then they don’t have to give any notice at all – they simply return the keys.
Why is one month’s notice hard to manage? Is it that you can’t afford the time to properly vet new tenants, or can’t afford the property to be empty for a month between tenants, or something else?
Whether they have to give notice to leave at the end of the initial/fixed term depends on the type of tenancy. If the landlord has used the Openrent tenancy agreement then the tenant would have to give notice to leave even during the initial term
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Very interesting perspective. I always used to renew as I thought it was better to protect me from them moving out quickly after it goes periodic. I also didn’t know we could raise the rent without changing the contract, so another thing I’ve learned today.
So when the contract comes up for renewal in October, I can just let it go periodic and raise the rent anyway using s13?
Yes, but by then we will have a whole new tenancy regime thanks to the RRB.
I see yes, there are lots of changes coming up. What about the eviction process, if S21 is being scrapped, will we be able to gain possession if we want to sell or even move back into the property? It seems this has not been thought through very well.
Yes you can get your property back if you want to sell or you or your family want to move back in. Although there are certain conditions.
You have to give 4 months notice and you can’t give notice in the first year of the tenancy.
Also if you evict for the above reasons you can’t re-let for a year which could be a problem if you are unable to sell.