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Tenancy break clauses

Posted: February 2017

By Jo Eccles

Q: I have found a property to rent and the landlord is asking me to commit to a two-year tenancy, should things go wrong how can I protect myself?

A: Landlords will usually be keen to secure a tenant on a longer term basis as it’s much more lucrative for them. There are various costs and charges incurred every time a tenant changes, so the longer a good tenant stays, the better.

The average tenancy agreement lasts for 12 months but signing a longer agreement gives you and the landlord certainty. Assuming that you enjoy living in the property and it’s managed in a professional manner, either by the landlord or a management company, having certainty that you can remain for a longer term can be reassuring.

However, it is sensible to consider the scenario where you need to move earlier, for example, quitting or losing a job, relocating for a job, or problems with the property or landlord.

A break clause will give you flexibility to move before the end of the two years. In your offer email, you could request a tenant only break clause from six or 12 months, but stress that you don’t expect to use it.

Or as a compromise, you could request a ‘business break clause’ which would release you from the tenancy early if you lose your job or you are relocated more than a specified agreed distance from your existing office location.

If you are competing with another tenant who is offering to agree to the two years with no break clause, the landlord may favour them over you, but if you’re really not comfortable committing then it’s worth walking away. However, if the property looks well-kept and you get a positive sense that the landlord is fair and will uphold their obligations, then it might be worth committing to it. If the existing tenant is present during your viewing, definitely quiz them about the property and landlord as they can give you an invaluable insight.

As with any contract, make sure you read the tenancy agreement very carefully before you sign to make sure that you are comfortable with the terms and it reflects what you have agreed. If you don’t understand anything then ask the agent to explain and, if necessary, amend any wording which is ambiguous.

If you have a question you’d like Jo or our team at SP Property Group to answer please email info@sourcingproperty.co.uk or tweet her @joeccles