Types of Tenancies
Should I use a fixed-term or periodic lease to rent my house? Which is best?
It depends upon which arrangement is better for your personal situation. If you are interested in renting property on a long-term basis with the ability to raise the rent periodically, it will be better to have a periodic tenancy. However, periodic tenancies are governed by a regime which requires that you can only evict tenants for certain reasons, and with the required amount of notice or where they are clearly breaking the tenancy agreement. Furthermore, your tenant is free to terminate at any time and move out.
If you want to rent your property to one tenant for a certain period of time, a fixed-term tenancy might be better for you. If either you or the tenant end the tenancy before a fixed-term is ended, then the party who breaks the agreement is at risk of being liable for damages for the loss of the tenancy. Similarly (unless your lease states that it becomes a month-to-month lease on the expiry of the fixed-term), the tenant must move out at the end of that term and no additional notice needs to be given (although it is prudent to do so).
As a general rule, you cannot raise the rent during the term of a fixed-term tenancy, unless it is something that both you and the tenant agree on. Any agreement to change the original agreement should be in writing and signed by both of you. The only other possibility for raising the rent during the term is that when you and the tenant made the original fixed-term agreement, it was a term of the agreement that the rent would increase at a certain date to a certain rate.
This page was last updated in March, 2006.