What are Periodic Leases?
A periodic tenancy is for a recurring period without a fixed term.
Many periodic tenancies are usually month by month leases for an indefinite period with verbal agreements rather than written agreements. However, a periodic tenancy can also be written for a periodic lease.
Often, a periodic lease comes about because a fixed term lease has expired, and a new lease has not been signed yet. A periodic tenancy can even continue indefinitely, recurring automatically until something is done by either the tenant or landlord to end this arrangement.
Rent increases in a periodic lease
While a tenant still has the same renter’s rights under a periodic lease, the biggest negative is that your rent won’t be fixed so a landlord has the flexibility to increase the rent when they choose to with two months’ written notice.
This is something that can’t happen in a fixed-term lease unless this is specified when you re-sign your lease – and is usually why, most preferred leases are fixed term leases.
An occasion where a tenant may want the flexibility of a periodic lease is if they have an impending change to their circumstances (example, working or moving to another State), in which case, a month by month lease is a good short-term option to manage in these types of instances.
Other factors to consider:
- Moving from property to property is both time consuming and can be costly (you will have to clean the properties you leave and cover your bond each time, plus there’s usually a waiting period to get your bond back).
- Most landlords will not allow a periodic lease so your property choices are limited.
- Your landlord still has the right to routine inspections and can end the lease with relatively short notice - two months’ notice compared to a fixed-term agreement where the landlord can’t end the agreement unless it has been breached or both parties mutually agree to end the lease early.