“Can you explain how an agreement can become a periodic agreement?” – Peter
How exactly do periodic agreements work?
We asked Business Development Manager at Absolute Real Estate, Michelle Kathopoulis for her advice on periodic agreements.
“A periodic agreement is when the lease agreement has reached and surpassed the lease expiry date,” Michelle explained.
“There is no longer a lease expiry date but a lease is still in place based on the original terms and conditions. It can reoccur for as long as both parties desire and until one party provides notice to the other to vacate or terminate.”
Michelle said there are different notice periods for both parties, and it may depend on the required notice time frame outlined in the lease, or the period of the rental payment e.g. fortnightly or monthly, depending on your state’s legislation.
“Your lease will have this information contained in it,” she said.
“If there was no lease to begin with, the owner’s acceptance of rental payments establishes a lease with standard terms and conditions governed by each state’s Tenancy Act.
“While some owners will agree to a periodical (or periodic) tenancy, many others may not for reasons that it may affect their landlord insurance by reducing their amount of cover, and there may be smoke alarm testing and servicing required each 30 days (depending on the state and its legislation) when a periodic agreement is in place.”