Removing fixed-term tenancies will drive up rents as landlords switch to short-term lets, warns Propertymark.

It fears the government’s planned overhaul of the tenancy system in the Renters’ Rights Bill could have unintended consequences as the complete removal of an initial fixed term will mean every tenancy effectively becomes a short-term let.

Propertymark says security of tenure for the tenant and a guarantee of rent payments for the landlord means fixed-term tenancies are requested by tenants, including many nurses working in hospitals for set periods, as well as from overseas, and families who want to stay in an area because their children are at a school.

Without the security of a rental term for a landlord beyond the two months’ notice period and no long-term guarantee of rent, it expects to see a significant number attracted to higher rents in the short let market, which also offers the advantage of being unregulated. With already limited housing supply, this will increase rents for individuals, couples and families looking for a long-term home.

Student impact

Removing fixed-term tenancies will also impact the student market, adds Propertymark. With rent instalments being limited to one month’s rent, removing the possibility of paying rent in advance will change the student sector where tenants typically pay rent from receiving student maintenance loans termly.

Head of policy and campaigns, Timothy Douglas (pictured), says it wants fixed-term tenancies retained as an option and an impact assessment conducted.

“The UK government must enact the registration of short-term rental property requirements as passed in the Levelling-up and Regeneration Act 2023 alongside these reforms to level the playing field for landlords and the long-term rental market,” he adds.

“It must extend Ground 4A to one or more student sharers, move student maintenance loans to monthly instalments and/or, allow rents in advance for student renters and others to keep flexibility and access to housing.”