The pros and cons of an implied surrender of tenancy explained
In my last article, I discussed ending a tenancy agreement by mutual agreement and how an express surrender of tenancy is needed to do so. But what if your tenant has abandoned your property? As we wrote recently, there is a new abandonment process entering law (though it is not yet clear when). However, it may be possible to use what is called an implied surrender of tenancy to gain possession of your property when it has been abandoned.
What is an implied surrender of tenancy?
An express surrender of tenancy is in written form and constitutes a mutual agreement between the tenants and the landlord to end the tenancy early. However, it can also be that the actions of the tenant (or the landlord) imply an end to the tenancy.
One such example is when the tenant abandons the property and stops paying the rent. In such a case, implied surrender may be used to regain possession of the property and re-let it. However, for reasons I’ll explain later, implied surrender should only be used as a method of last resort. Instead, you should use either:
- Eviction, by Section 8 or Section 21 notices. If you are approaching the end of a fixed-term tenancy agreement or it is a periodic tenancy, this is currently the preferred solution.
- If the tenant has stopped paying rent, then a Section 8 notice is the preferred route.
Other reasons for repossession include that the tenant has broken the terms of their tenancy agreement. One such term may be that the tenant must not leave the property unoccupied for more than two weeks – which may look like abandonment.
What is abandonment?
Abandonment is defined as when the tenant leaves the property and stops paying the rent. Should this happen, it is a pretty nerve-wracking time for a landlord. The tenant hasn’t said he is leaving, but you are not receiving rent. You’ll probably want to get it to re-let as soon as possible to cover your buy-to-let mortgage and other costs.
However, you must tread carefully. Your tenant may simply have gone an extended holiday without letting you know. They may have been in an accident and be in the hospital, without the means to contact you. If you take possession of the property and re-let it, you could be in hot water when the tenant does return.
What must you do if you think your property has been abandoned?
It is imperative that you make every effort to contact the tenant – and that you record such efforts. Remember, your aim is to confirm that the property has been abandoned permanently and that there are no other reasons for it being left empty. You should send letters to their last known address, leave messages on their mobile phone, contact their friends and family, and even their employer. Keep records of every contact attempt you make.
If you cannot contact the tenant and you are not receiving rent, and you suspect the property has been abandoned, then you can use the implied surrender to regain possession and re-let. You get your property back, and it starts earning you an income again.
The drawback of implied surrender to regain possession of an abandoned property
By regaining possession and re-letting, you are evidencing that you believe the tenancy agreement has ended. As such, you will not be able to claim unpaid rent between the time you regained possession and the end of the tenancy agreement.
Additionally, if the tenant does return and you have re-let the property or simply taken back possession of it, the tenant may have a claim for illegal eviction.
By its very nature, an implied surrender will not be detailed in writing and signed by both parties. Therefore, it is open to dispute. You could be accused of harassing the tenant and unlawful eviction by simply changing the locks.
With the potential ambiguity of implied surrender, though it may be an option, we would normally advise against its use to regain possession and instead issue Section 8 or Section 21 notices. It may be a long process, but there will be no grey areas that could be disputed.
In my next article, I’ll examine how to use an implied surrender to gain possession of your property when it has been abandoned by your tenants.
In the meantime, to discover the benefits of effortless property management, contact Ezytrac today on+44 0 1522 503 717.
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