Tenants and landlords push for longer tenancies amid plans to abolish fixed-term tenancies

Tenants and landlords want longer tenancies despite the Labour government planning to abolish fixed-term tenancies.

According to a survey Leaders Romans Group, both landlords and tenants are seeking security in an unpredictable private rented sector, with some landlords even willing to reduce rents to retain long-term tenants.

The Renters’ Rights Bill proposes abolishing fixed-term tenancies and replacing them with periodic tenancies, which is expected to cause chaos, particularly in the student rental sector.

Stability for tenants and landlords

A survey by Leaders Roman group reveals, that 44% of tenants and an equal percentage of landlords now favour one-year fixed-term contracts.

In a statement to the survey, one landlord said: “As a new landlord, I’d like to build open, transparent relationships with my tenants to encourage longer-term rentals.”

Another landlord highlighted regional challenges, saying: “The reduction of rental properties in Stamford has pushed tenants to seek longer agreements to ensure they can stay in the area.”

According to Leaders Romans Group, more landlords are showing interest in retaining long-term tenants and are willing to implement strategies to encourage loyalty.

The survey reveals that 30% of landlords are considering investing in property upgrades, 15% are open to offering rental discounts, and 6% are exploring flexible lease terms.

Allison Thompson, national lettings managing director at Leaders Roman Group, said: “The economic landscape has heightened the value of stability for tenants and landlords alike.

“As inflationary pressures and the cost of living rise, we’re seeing tenants opt for longer-term agreements as a way to secure current rental rates, while landlords are prioritising tenant retention through incentives and flexible terms.

“As both landlords and tenants navigate these economic pressures, flexibility and incentives are emerging as key factors in tenancy negotiations. The shift towards longer-term arrangements provides an opportunity for industry stakeholders to meet evolving tenant demands while ensuring stability across the rental market.”

Rent reductions

The report also highlights certain areas of the country experiencing rent reductions to retain longer-term tenants.

Zoopla’s September 2024 rental market report says that rental inflation has slowed to 5.4%, the lowest level in almost three years.

Chris Myers, regional lettings director, told the survey that Bournemouth has seen significant rent reductions.

He said: “We have seen viewing numbers drop in Bournemouth, showing a slow in demand, so we have had to initiate significant rent reductions to keep activity consistent.

“Particularly in the South West, we have seen demand slow which is typical for the time of year but in turn rents then come down to combat that slow-down in market transactions.”

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