Thursday 11th October 2018

Most tenants don’t want three-year tenancies, survey shows

Six out of 10 renters want tenancies of 12 months or less, a new AXA survey suggests.

The government, which wants to offer tenants more security by introducing longer tenancy terms, has already consulted on the introduction of three-year minimum tenancies. But AXA found a muted response to the plan.

Many tenancy agreements are currently set at 12 months with a six-month break clause, and it would appear that most tenants are happy with this length.

When asked the length of tenancy agreement they would prefer, 62% of tenants still opted for a period of one year or less.

AXA’s findings reinforce that the majority of people want either the flexibility of a shorter rental.

In the coming year, half of private renters surveyed anticipate making a big life change that will affect their housing – having a baby, moving in with partners, divorcing, or relocating to a different part of the country.

One in ten tenants expect to move to a different part of the UK by this time next year, while a similar number expect to move overseas within three years.

One explanation for this low appetite among renters for longer leases is that most expect to own their own home eventually, with just 12% of renters saying it is not likely.

For the interim, while still renting, the priority for most is very much on agility and mobility rather than being tied to one property.

But the three-year tenancy proposal is likely to find favour with tenants who have children, who understandably want the security of a longer term. However, even in this group the preferred tenancy length is just two years.

The five- or ten-year leases as seen in Germany and other continental countries are attractive to a quarter of renting families.

Given the high mobility among renters, the Tenants’ Fees Bill, currently making its way through parliament, is likely to prove more popular than multi-year leases.

Six in ten renters say they have had to pay the types of fees to landlords and letting agents that the Bill seeks to outlaw. These are mostly fees for starting, ending or renewing a tenancy agreement. A quarter of tenants say they have had to pay for the pleasure of having a credit or reference check done against them too.

However, the proposal to ban landlords from demanding deposits in excess of six months’ rent seems somewhat irrelevant as far as far as renters are concerned.

Just 8% of tenants say they have ever had to pay such a large deposit.

Article courtesy of Landlord Today | Sign up for Landlord Today newsletter | Get this news on YOUR site!