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AST Renewal - can I deal directly with the tenants?


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I am currently the landlord of a property and the tenants have been in place for 3 years via a high street lettings agent. The contract is for Rent collection, 3 monthly inspections and a final inspection and they change 12.5% for that & 6 monthly renewal fees of £90.

I was hoping to deal with the tenants directly at the end of this tenancy agreement in May and the tenants wish to deal with me directly but unfortunately the agents are now aware of this.

The termination clause in the contract is:

"Each of the Landlord and the Agent has the right to terminate this Agreement when a tenant vacates at the end of a tenancy, on the occasion of a material breach of the Terms and Conditions of this Agreement during a tenancy, such termination to be advised in writing and to b subject of at lest 14 days during which period breach may be rectified and the termination cancelled by agreement."

The lettings agent has advised that the tenants are unable to stay on at the property which is understandable unless they move out at which point the tenancy agreemen ends.

The tenants are determined to avoid continue paying renewal fees etc etc and said that they would actually be prepared to physically move out of the property at the end of this AST (2 months notice have been issued already by the agent on my behalf) so the agent can do the final inspection and then move straight back in again using a contract directly with us.

My question is if the agent would still be likely to come after me / the tenants and how long would they actually need to remain out of the property for before going back in under a new AST?

I don't particularly want to wind up the agency as they've not been too bad but it's costing too much money to retain them as I barely cover the mortgage (it is a repayment mortgage as it was only ever intended to be rented out 3 years ago as a stop gap)

Does anyone have ay experience / advice on this situation please?

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Hi Joby,

This type of question comes up a lot on the forum and my advice is always the same. You were happy to agree to the letting agents terms when your property was empty, tenantless and earning no income but now they have found you a good set of tenants who are paying the rent every month then you want to "cut the agent out of the loop".

The contract you signed with the letting agent is pretty clear - it can be terminated when the tenant vacates. You did not have to sign this contract but you did because you wanted them to find you a tenant.

My advice is not to look for an underhand way to remove the letting agent, especially as you are happy with the service that they have provided over the last few years, but instead try and find a compromise with them.

How about getting the tenants to sign a 2 year extension thereby reducing the frequesncy of the renewal fees to the agent? How about going to meet the manager of the letting agency and try and negotiate on the 12.5% fee? How about increasing the rent slightly to offset some of the letting agents costs. How about asking the letting agent to let you convert to their "tenant introduction service". In other words offer to pay them a "one off" fee so that you can take control of this tenancy in an open and honest way.

If the letting agent won't compromise with you (to retain the business of a loyal customer) then I would threaten to terminate the contract with the letting agent even if that meant losing the tenant.

I think you are on very thin ice if you terminate the contract with the letting agent and then take the tenant, which they introduced and have been managing for 3 years on your behalf, on a new shorthold tenancy.

You might get away with it .... but if it was my agency I would "see you in the small claims court".

Good luck .... and let us know what happens ...


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If they are good tenants and are long termers - Then i would remortgage- buy another house and put them in it - Then relet the first house to new tenants - Then Smile & relax in the knowledge you just made a shrewd investment!

Yes I'm serious. I did this for a long term tenant 2 years ago - we gutted the house and let them have a say in the design and decor and yes the are still with me !

Did i do this for them ? Well partly ! the pretax profit in that particulr property as i write is approx £130,000 which i will shortly be remortgaging to buy more !!!

Every cloud has a silver lining!



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