While they lack the flexibility of a short-term rental, they have a higher return. A long-term rental is usually from one year onwards. While they may lack the flexibility of a short-term rental, they perform better in several respects. Long-term leases involve a rental contract of more than 6 months or a year.
Typically, and again this will vary from country to country and from contract to contract, there will be a renewable agreement where tenants are expected to remain in a property for several years. Long-term rentals are ideal for people looking to settle in a particular area for six months or more, or to put down roots on a long-term basis. So what is the duration of a long-term lease? In short, a long-term rental contract is from 6 months onwards. Although long-term leases do not offer the same flexibility and rate increases as short-term leases, they are more efficient in several respects.
Long-term leases are the standard business model for many landlords. It is common to offer tenants a lease of at least 12 months, which can be renewed at the end of the term, provided both landlord and tenant are happy with the arrangement. The rules are different across the UK, as England and Wales have a different law to Scotland. Here are the rules you need to be aware of.
Most landlords offer a short-term tenancy agreement (AST). These agreements start with a fixed term, usually lasting between six months and three years, although it can be as long as seven years. The AST is difficult to terminate before the end of the fixed term, so when talking about the length of the lease, it usually refers to the length of the fixed term. The key decision for landlords in England and Wales is therefore the length of the lease.
Given that most landlords rent a property as part of a long-term investment or income vehicle, the obvious initial choice is to make the agreement cover as long a period as possible. However, long fixed terms have disadvantages that outweigh the benefit of security. As a general rule, a short-term lease is usually a rental property that is offered to the market for six months or less. Leases ranging from 6 months to one year are usually marketed as medium-term leases, and anything longer than one year is considered a long-term lease.