12 month tenancy agreement

[booyaah]

Hi all

thanks for the advise and comments, at this stage hes not too sure what he is going to do but will keep in touch.

cheers

[Perry]

I am one of those boring types one girl friend one wife one marriage.

Its not that boring when they're all at the same time

Especially if they're all the same person!

[[email protected]]

Hi booyaah. AS no one else has stated the obvious, get the owner to ring or email me. I'd love to buy the property and keep the tenants in, subect to a bit more info about the property. This would make everybody happy!!
[email protected] or 021 567427

[SuperDad]

I am one of those boring types one girl friend one wife one marriage.

Its not that boring when they're all at the same time

[Glenn]

well Perry the tenancy problems after various affairs of the heart (or some other part of the body) are rotten.
These are the hardest ones to call because the people have been so good for so long. They tell you all the inside story on who has done what and that is enough to turn me inside out. I am one of those boring types one girl friend one wife one marriage. Nice having the world to myself. the down side is I have not got a clue about what they are talking about. So when the rent stops coming to you the first reaction is that they will see your right. Who on earth wants to turn into a beast and reward many years of faithful stewardship by kicking someone out and taking some of their benefit. This is why property management is such a growth industry. You have to be mad to do it and get mad doing it.

[Perry]

Interesting, Glenn. Sounds like the voice of experience
when you refer to post relationship break-up rental woe
syndrome.

My notion that 3 months, comprised of two short term
fixed term probationary tenancies is a safe way to go is
somewhat negated by what you describe. Maybe I'll
avoid 12 month FTTs, from now on?

[Glenn]

Well actually I subscribe to Waynes view also. So much can go wrong with tenancies. Even so called good ones can go belly up. You can start with decent people then the man walks out and the lady can get some low life in there because she is desperate or what ever. Happens all the time. 90 days seems like forever waiting for a dog owning incumberant to leave. But this sure beats waiting 360 days.
Just try getting someone out that is noisy or selling drugs or what ever. I have never had a commercial tenant cause that sort of trouble but I have had one or two slow paying commercial tenants.

[Perry]

What?!

Why not just burn the house down and be done with it - a lot simpler.

Is that with or without the nonpaying tenant in residence?

Depending on it's length, a FTT seems to have a lot
going for it. I'd also suggest (Wayne) that a non-payer
can occur in a commercial situation, too. And nearly all
commercial leases are 12 months or longer. If the tenant
goes belly-up, it's no different to a residential non-payer,
generally speaking.

[xris]

I wouldn't bother with a Fixed Term Tenancy because it binds the nice law abiding landlord but doesn't really bind the tenant! All the Tenant needs to do is stop paying rent and they will get out (the landlord will evict, tenant then pays dues so doesn't have a debt). Just not worth the risk.

What?!

Why not just burn the house down and be done with it - a lot simpler.

[Wayne]

I wouldn't bother with a Fixed Term Tenancy because it binds the nice law abiding landlord but doesn't really bind the tenant! All the Tenant needs to do is stop paying rent and they will get out (the landlord will evict, tenant then pays dues so doesn't have a debt). Just not worth the risk.

For commercial it is a differant story mostly.

[SuperDad]

Thanks Glenn for that very good explanation of the workings of a FTT. Now I understand why I sometimes see properties advertised with claims like "Fixed term tenancy until Jan 2007".

[Glenn]

Xris,


Once again, I'm struck by the feeling that the law's an ass. It seems odd that one can't sell a house in which reside tenants on a FT tenancy. .

The law is not an ass. A lease is a valuable asset. It is a money stream for the period of the lease.
That is why commercial properties with good leases in place are worth more than those with no or poor leases.
There is no reason why a residential property can not be sold with tenancy in place. In fact lots of them are sold this way. Unless the rent is below market rate I see little or no reason why it should fetch anything but full market value. In fact for some properties just like commercial properties it may in fact be worth more to the prospective purchaser.
The last thing us investors want is some law that steps all over our lease contracts and permits people to break their contracts. Goodness this is the start of a break down in our society and economy.
Section 50 (a) is quite clear. The tenancy is terminated when the term of the tenancy expires.
However section 66 deals with reduction of the term of a fixed term tenancy.
Without laboriously typing out the full section it states that the tribunal can reduce the term for either party if unforseen circumstances occur and if one of the parties will suffer hardship. However 66(2) states that compensation then needs to be paid to the other party.
Simply not using ones head and being imprudent can not be regarded as "unforseen". It might be unforseen by one party but to everyone else it is likely to be quite clear.
I guess we can all think of the unforseen things that can occur. Things like death, mental break down or loss of a job must be regarded as unforseen.
Discovering three weeks after the start of a tenancy that you can not afford to be a landlord does not wash.
We see lots of our tenants with this sort of affliction.
There is no excuse for a landlord to be similarly afflicted.

Remember what the "Lord" of landlord stands for.

[Son of G]

Paul

That RTA is avalible online (updated monthly). Click here.
Happy reading.

Keith

[SuperDad]

Xris,

I did not know that! (But then, there's a lot I don't know.) Could you please point me in the direction of the relevant sections in the RTA that deal with fixed term tenancies, and the conditions under which notice can be given? (I've been looking, but can't find these. But I'm not familiar with the RTA - I'm a "virgin" here.)

Once again, I'm struck by the feeling that the law's an ass. It seems odd that one can't sell a house in which reside tenants on a FT tenancy. The tenants in this case seem to become like chattels - items included with the sale. It also seems to place an unreasonable burden on landlords.

Learning all the time,

Paul.

[xris]

Being a bit lazy, here, Xris, but I have reservations about
your comment that the interest on the rental cannot be
claimed, even though there's been a change of use.

From experience, I know that it is not a difficulty to 'transfer'
something from private usage to business usage and the reverse.
(Usually this is just a book entry, but some transactions
do need supporting documentation, e.g. independent valuation.)

What creates the impediment in this case?

Hello Perry,

This has been discussed to death on this site. I do believe there are ways to do it properly, in part or in full, but it is not that easy.

This example looks to me though like a very good example of the commonest mistake made by people who just put tenants into their own home and claim all sorts of costs.

The impediment to claiming interest as a deduction in this case is simply that the intention of the loan, if there is one, was to buy a home for the purchaser to live in. It is difficult in most cases to overcome that problem without going to a lot of trouble and effort. Simply changing the use of the property from personal to business is irrelevant to the intention of that original loan.

Doubtless others will comment further.

xris