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Short-term and long-term lets – what’s the answer for you?

POSTED ON 26 APRIL 2017


Deciding on whether to go for a short term or a long term contract has its pros and cons for both parties; this guide may help you in making your decision as either a landlord or a tenant.

Renting property is such a competitive market these days, and so a landlord will naturally want to make the best, most shrewd decision they can in opting to make the property they’re letting out available as either a long-term contract or a short-term contract. There are obviously a variety of factors involved in helping a tenant decide on where they want to rent, and the type of contract attached to the property is, in fact, amongst the most important, and here’s why.

A short term contract generally is a contractual agreement that lasts for less than a year, before it then has the option of being renewed by the landlord if that’s what’s desired by both parties. Because short term lets are therefore more flexible, their popularity can result in them being hard to find by tenants, particularly in lesser populated towns and cities. If the area is highly populated, landlords would be able to afford to be even more selective with whom they choose as a tenant, and so there’s a higher chance they’ll offer short term lets.

If a homeowner is not planning on using their property for a certain amount of time, a short term letting agreement with a prospective tenant could be ideal, as it would likely be cheaper than a hotel for the tenant and also offers the adaptability required for the landlord to move back in once the contract has finished. During peak holiday seasons especially, such as December, the landlord (if they have a second property they can live in during the meantime) could rent their property out for a short duration, and thus a short-term let would be a suitable agreement.

A long term contract is usually for a minimum of a year, but can potentially last for longer. This contract could mean that the tenant would be required to pay rent for the entire duration of their minimum required serving time at the property, even if they decide to leave early. But this will depend on the conditions within the contract, which may state otherwise. If stability is what’s desired, however, a long term contract could be the answer, for both the tenant and the landlord.

This is because a long term contract enables the landlord to spend less time tending to contractual obligations, allowing them more free time and less hassle. This can be particularly beneficial if the landlord is letting out several properties. It also helps those with buy to-let mortgages calculate their return on investment more accurately, since their income will be guaranteed for the entire duration of the tenancy. However, long term contracts can be rigid, both in tying the landlord down to what could be a problem tenant, and also in preventing them from taking advantage of increasing rental prices in the area.

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