What is a periodic rolling tenancy?

As a landlord, you have a variety of options when it comes to structuring a tenancy for your tenants. One common tenancy arrangement is the periodic rolling tenancy which offers flexibility and convenience for yourself and your tenants. Here, we’ll explore everything you need to know about periodic rolling tenancies and what to consider if you’re structuring one for your tenants.

What is a periodic rolling tenancy?

A periodic rolling tenancy is a type of rental agreement that does not have a fixed end date. Instead, it “rolls over” automatically on a monthly, weekly, or sometimes quarterly basis. This arrangement typically follows the structure of a fixed-term tenancy (a lease with a defined start and end date). When the fixed term expires, and neither party signs a new fixed-term agreement, the tenancy automatically transitions to a periodic rolling tenancy. The features of a periodic rolling tenancy include: 

• Regular renewal: The tenancy continues and is renewed automatically until either party terminates the agreement.
• Flexibility: Either you or the tenant can end the agreement with relatively short notice – usually a month’s notice.
• No fixed end date: The tenancy does not have a specified expiration, making it ideal for those who prefer not to be bound by long-term commitments.

So, the periodic rolling tenancy is the same as a fixed-term tenancy with the exception of there being no end date. The tenant will have the same responsibilities as with the fixed-term tenancy agreement, i.e. rent amount and the property rules. 

The rolling tenancy agreement will then continue until either you, as the landlord, or the tenant gives proper notice to end the agreement.

Benefits of a periodic rolling tenancy

There are benefits of a periodic rolling tenancy agreement for yourself as the landlord, including: 

• Ease of adjustment: You can give notice relatively quickly to your tenant, which allows you to gain back possession of your property in a short period of time.
• Ability to respond to market conditions: With shorter notice periods, you can adjust your rental rates more easily or take back your property if you have other plans for it.

Drawbacks of a periodic rolling tenancy

Despite the flexibility, periodic rolling tenancies come with some potential downsides for you, as a landlord, including: 

• Higher turnover: Because your tenants will have the freedom to exit the tenancy agreement a lot easier, you may find yourself having tenants leaving a lot more frequently.
• Inconsistent income: The lack of a fixed term means landlords have less security regarding rental income continuity.

Notice periods in a periodic rolling tenancy

It’s crucial that you stick to your notice periods for this type of tenancy agreement as a landlord, and that you are aware of your expectations around this. You’re able to use a Section 21 notice to inform your tenants that you want to end the tenancy agreement, giving them a 2-month notice period. 

Equally, if you feel the tenant has violated the terms of your tenancy agreement (for example, by engaging in anti-social behaviour or failing to pay rent), you can serve your tenant using a Section 8 notice. The notice period can be between 2 weeks to 2 months, depending on the reason for wanting to end the periodic rolling tenancy.  

Rent increases in a periodic rolling tenancy

In a rolling tenancy, you can adjust your rent to align with market rates. For tenants who pay rent monthly, you need to provide at least one month’s notice before the increase takes effect. 

If tenants pay rent on an annual basis, a longer notice period (usually six months) is required before any rent changes. This ensures tenants have time to prepare for any adjustments and can then decide if they are happy to continue with this type of tenancy agreement. 

Is a periodic rolling tenancy right for you?

A periodic rolling tenancy can be a great option for you if you need flexibility with your property or are looking to sell it in the near future. You can also increase the rent on a periodic rolling tenancy at market value, but you would need to give at least one month’s notice to those tenants who pay rent monthly. 

Periodic rolling tenancies provide a flexible option for both tenants and landlords, with a tenancy that continues on a regular basis rather than ending on a fixed date. If you value adaptability, a rolling tenancy can be the perfect choice for you, however, you should ensure that you understand the implications and regulations around notice periods and the rights of your tenants. 

You’ll be able to ensure that both yourself and your tenants mutually benefit from this type of tenancy agreement if you keep communication clear and open with your tenant. 

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