Why landlords would need to implement an early tenancy termination

As a landlord, maintaining a steady stream of rental income and minimising turnover costs will easily become your primary objectives. There may be times, however, when implementing an early tenancy termination is beneficial for both yourself and your tenant. 

There are different reasons as to why you might feel the need to terminate a tenancy early and understanding these scenarios can help you make informed decisions that will ultimately protect your investments while maintaining a positive relationship with your tenant. Here, we’ll take a look at the different reasons you may be considering an early tenancy termination and how to go about implementing an end of tenancy notice. 

Tenancy agreement types

Before going into the details of how to implement an early tenancy termination, you’ll need to understand how much notice to give your tenants. The amount of notice you’ll need to give will depend on the type of tenancy agreement your tenant has agreed to. 

Assured shorthold tenancies (ASTs) 

You can terminate the tenancy agreement with your tenant without giving a reason if they have a periodic tenancy or a fixed-term tenancy that has ended. This is known as a Section 21 notice. 

To be able to do this, you must have put your tenant’s deposit in a deposit protection scheme and given your tenant at least 2 month’s notice. Also, the date the tenancy agreement ends needs to be at least 6 months after the tenancy began. 

You can serve your tenant a Section 8 notice if they have fallen behind on their rent, if they have been involved in any illegal activity on your property or if your tenant has damaged your property beyond repair. 

Assured tenancies

If your tenant has signed an assured tenancy agreement, you’ll need to use any reasons from the Housing Act 1988 in order to legally implement an early tenancy termination. 

Excluded tenancies or licences

There are also instances where your tenant may be lodging with you or room sharing with you. If this is the case, you are within your rights as a landlord to terminate the tenancy by giving reasonable notice. This typically means that you give the amount of notice that is the same length of the rental payment period. This notice does not need to be in writing either. 

Non-excluded tenancy or licence

With a non-excluded tenancy or licence, you will only be required to give at least 4 week’s notice, but can implement an early tenancy termination at any point by serving a ‘notice to quit’. 

It’s important to remember that you are unable to serve an early tenancy termination notice before 6 months of your tenant renting from you. 

Reasons for early tenancy termination

Now that we’ve covered the different types of tenancy agreements available to you, let’s cover the different reasons why you would need to terminate a tenancy early. 

Tenant financial hardship

Life can be unpredictable, and your tenants may encounter financial difficulties due to job loss, medical emergencies, or other unforeseen circumstances. If a tenant can no longer afford rent, allowing them an early lease termination can prevent prolonged financial strain on both parties. An amicable agreement may also avoid the cost and hassle of formal eviction proceedings.

Property damage concerns

Another reason for needing to end a tenancy early would be if a tenant is causing significant damage to your property.  Continued damage will eventually lead to higher repair costs and potential legal liabilities. Early termination allows you to mitigate these risks and restore your property to its original condition as soon as possible.

Breach of lease terms

Also, tenants who violate lease terms, such as engaging in illegal activities, disturbing neighbours, or keeping unauthorised pets, would also be a reason to implement an early tenancy termination. 

By enforcing lease agreements, you ensure that the property remains a safe and pleasant environment for all residents. This way, you won’t be surprised by any illegal activities going on within your property. 

Sale of property

You may be in a situation where you have decided to sell your rental property, which may fall before the end of a tenancy agreement. This would mean that you would have to serve an end of tenancy notice. 

Typically, potential buyers would prefer a vacant property, or one that has a flexible tenancy agreement, so offering tenants the option to terminate their lease early, perhaps with compensation, would also facilitate the sale process.

Personal use

There may also come a time when you would need to use your property for personal reasons, such as accommodating a family member or needing to move into the property yourself. Early termination in these situations allows you to regain control of your property in a timely manner, ensuring it meets your immediate needs.

Major renovations or repairs

If you need to renovate or repair your property, you may need it to be vacant, especially if the work that needs to be done is substantial and cannot be done with tenants residing at the property. So, in this case, you may need to offer an early tenancy termination as a practical solution, 

Mutual agreement

There may also be instances where both yourself and the tenant may mutually agree that an early tenancy termination is in your best interest. Perhaps the tenant has found a new job in a different city, or the landlord has received a lucrative offer to repurpose the property. In such cases, a mutually agreed-upon termination can be beneficial for both parties.

Implementing early tenancy termination

So, how exactly do you implement an early tenancy termination?  When looking to implement an early tenancy termination, it’s important that you  follow all legal protocols and ensure fair treatment of your tenants. Here’s how to make sure that you serve an end of tenancy notice legally:

• • Review lease agreements: Ensure that the lease agreement contains clear clauses regarding early tenancy termination, including notice periods and any associated fees or conditions.
  • Communicate transparently: Maintain open communication with your tenants by explaining the reasons for the early tenancy termination. You can also offer assistance, such as helping them find new accommodation or providing financial compensation.

• Legal compliance: Ensure that any early tenancy termination complies with local rental laws and regulations. Consulting with a legal professional can help navigate complex situations and avoid potential disputes.

• Documentation: Keep thorough records of all communications and agreements related to the early tenancy termination. This documentation can be invaluable in case of legal disputes.

• Compensation and support: Consider offering tenants compensation for their inconvenience, such as a rent refund or assistance with moving costs. Providing support will reduce the likelihood of conflicts.

While early tenancy termination is not an ideal scenario, it can be a necessary and strategic decision for you as a landlord. By understanding the potential reasons and implementing a fair and legal process, you can protect your investments, maintain positive tenant relationships, and ensure the smooth management of your rental properties. 

As part of protecting your property during early tenancy terminations, you may be on the lookout for the best landlord insurance deals around. At CIA Landlords, our team of experts will help you find the best deals for you as a landlord. Make sure to contact us at 01788 818 670.