A Lease Renewal Agreement is a formal legal document used in England and Wales to extend or renew an existing lease once the original fixed term has expired. It creates a new binding agreement between the landlord and the tenant, setting out the terms on which the tenancy will continue for a further period. Unlike a lease variation (which amends specific terms of a live lease) or a lease extension by deed (used for long leasehold properties), a lease renewal establishes a fresh tenancy relationship grounded in the parties’ mutual consent, while preserving continuity of occupation and, in most cases, the existing terms of the original lease.

For residential properties in England and Wales, the Lease Renewal Agreement most commonly takes the form of a renewed assured shorthold tenancy (AST) under the Housing Act 1988 (as amended by the Housing Act 1996 and the Deregulation Act 2015). When the fixed term of an AST expires, the tenant does not automatically become a trespasser. Section 5(2) of the Housing Act 1988 provides that a statutory periodic tenancy arises by operation of law on the day after the fixed term expires, on the same terms as the original AST. While this periodic tenancy is legally effective, many landlords and tenants prefer to document the continuation of the tenancy in a formal renewal agreement, particularly where the rent is being adjusted, new terms are introduced, or the parties wish to agree a further fixed term.

The Renters’ Rights Act 2025, which takes effect on 1 May 2026, will significantly alter the residential tenancy landscape in England and Wales by abolishing new fixed-term ASTs. Until that date, landlords may still grant fixed-term renewals. Renewal agreements signed before the Act comes into force will be respected for the duration of their fixed term.

For commercial properties, the Landlord and Tenant Act 1954 provides qualifying business tenants with a statutory right to renew their tenancy on broadly the same terms at the market rent, unless the landlord can establish a statutory ground for opposition. A lease renewal agreement for a commercial property documents the new terms agreed between the parties, including the new rent (whether agreed directly or fixed by the court), the new term, and any updated covenants.

The Lease Renewal Agreement interacts with several important statutory frameworks in England and Wales. The Tenant Fees Act 2019 prohibits landlords and letting agents from charging tenants any fee in connection with a residential lease renewal. The Housing Act 2004 requires landlords to protect tenancy deposits in a government-approved scheme (DPS, MyDeposits, or TDS) and to re-serve the prescribed information within 30 days of the renewal commencing. The Deregulation Act 2015 imposes conditions that must be met before a valid section 21 notice can be served, including provision of a current Energy Performance Certificate (EPC), Gas Safety Certificate, Electrical Installation Condition Report (EICR), and the How to Rent guide.

A Lease Renewal Agreement is needed in England and Wales whenever the term of an existing lease has expired or is about to expire and both parties wish to continue the tenancy on agreed terms. The most common scenario is a residential AST that is approaching its fixed-term expiry date. Without a written renewal, the tenancy will continue as a statutory periodic tenancy under section 5(2) of the Housing Act 1988, which may be suitable for some landlords and tenants but leaves the terms of the ongoing tenancy less clearly defined.

Landlords typically seek a formal written renewal for several reasons. A new fixed-term renewal provides income certainty by locking the tenant into the property for a defined period, preventing them from giving just one month’s notice to vacate. It also provides an opportunity to update the rent to reflect current market levels, to introduce new conditions (such as pet permissions or updated decorating obligations), and to confirm the landlord’s compliance with statutory requirements before the renewal term begins. A properly documented renewal also creates a clear paper trail that can be important if a dispute arises later about the terms or the deposit.

Tenants may seek a formal renewal to gain certainty about their right to remain in the property for a further period, to negotiate an agreed rent increase rather than face a statutory section 13 notice, and to clarify any updated obligations. A fixed-term renewal protects the tenant from rent increases or eviction during the renewed term (subject to any break clause).

A Lease Renewal Agreement is also appropriate for commercial properties where the tenant has security of tenure under the Landlord and Tenant Act 1954 and the parties have agreed the terms of the new tenancy without recourse to the court. Commercial landlords and tenants frequently negotiate and document renewal terms directly, avoiding the expense and delay of court proceedings.

Other situations calling for a formal renewal agreement include changes to the number of occupants, the addition or removal of joint tenants, the introduction of a pet, a change to the deposit amount following a rent increase (where the deposit cap under the Tenant Fees Act 2019 applies), or updates to the inventory. Where any of these changes occur at renewal, a new written agreement is the appropriate vehicle for documenting them.

Letting agents acting for landlords should note that the Consumer Rights Act 2015 requires all contractual terms to be fair and in plain, intelligible language. Any unfair terms may be unenforceable under the Act.

A valid Lease Renewal Agreement for use in England and Wales must contain a number of critical provisions to ensure legal effectiveness and to protect both the landlord and the tenant throughout the renewed term.

Party identification is fundamental. The landlord must be identified by full legal name and correspondence address. Where the landlord is a limited company, the Companies House registration number should be stated. All joint tenants must be named in the renewal agreement; a renewal that omits a joint tenant named on the original lease may create uncertainty about who holds the tenancy and who is liable for rent and obligations.

The property must be described precisely, with its full postal address including postcode, and any reference to the contents, fixtures, or fittings should refer to the original inventory or to an updated inventory annexed to the renewal agreement.

The original lease details must be referenced clearly, including the date of the original lease, the original commencement and expiry dates, and confirmation that the renewed tenancy continues on the same terms. This establishes continuity and prevents arguments about whether the renewal creates a new tenancy for SDLT or other purposes.

The renewed term clause is the commercial heart of the agreement. For a fixed-term renewal, it must state the precise start and end dates and, for residential tenancies, confirm the tenancy type as an AST under the Housing Act 1988. For commercial tenancies, it should state whether the 1954 Act applies and, if so, confirm that security of tenure has not been excluded.

The rent clause must state the monthly rent in pounds sterling, the payment date, and the payment method. Where the rent has increased from the original lease, the previous rent should be recorded. The agreement must confirm that no prohibited fee has been charged to the tenant under the Tenant Fees Act 2019.

A rent review clause, if included, must specify the review date, the basis for determining the revised rent (open market, RPI, CPI, or agreed formula), the notice period, and the procedure for resolving disputes (for example, referral to a RICS-appointed independent surveyor).

The deposit clause must confirm the amount held, the protection scheme, and the landlord’s obligation to re-serve the prescribed information within 30 days of the renewal. Any change to the deposit amount (for example, following a rent increase) must be reflected and the protection updated accordingly.

A landlord’s compliance statement should confirm that the statutory requirements under the Deregulation Act 2015 have been met: EPC, Gas Safety Certificate, EICR, and the current How to Rent guide. These are conditions precedent to the valid service of a section 21 notice (where applicable).

A break clause, if included, must specify the earliest date from which it may be exercised, the notice period, how notice must be served, and the conditions for valid exercise. Poorly drafted break clauses are a significant source of litigation in England and Wales.

A governing law clause confirming England and Wales as the applicable jurisdiction and an exclusion of the Contracts (Rights of Third Parties) Act 1999 complete the essential terms of a robust Lease Renewal Agreement.