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Tenancy Agreement – a complete guide for Landlords

by | Oct 5, 2022

Home $ What documents do I need to rent a flat in the UK? $ Tenancy Agreement – a complete guide for Landlords

Introduction

If you are a landlord and you are thinking to rent your property, then you must know about the tenancy agreement. A written contract between a landlord and a tenant.

A landlord must have a tenancy agreement with the party who is going to rent because it will act as a contract. 

The tenancy agreement will be highlighting the rights and responsibilities of both the landlord and the tenant(s).

Tenancy agreement

What Is A Tenancy Agreement?

The tenancy agreement is an agreement or contract between the tenant and landlord. It could be verbal or written. This contract gives defines the rights of both tenant and landlord. 

For example, defines tenants’ right to live in the accommodation, and the landlord’s right to receive the agreed rent on the assigned date.

It is highly recommended to go for a written tenancy agreement because it is lawful and can be helpful in case of any disagreement in the future.

For that purpose, a proper document is prepared, highlighting multiple factors, including all the responsibilities, duties and rights of both parties. The document includes the following factors:

Rent payment

This clause shows the rental payment, which will be written on the agreement of both parties. Plus, it also highlights the date on which the rent should be paid.

Tenancy length

This part of the document highlights the expected length of the tenancy. When the tenancy agreement is about to expire, both parties can sign a new agreement, known as tenancy renewal, if the tenant is willing to stay for a longer period.

Property activities

This part highlights the tenant’s rights, such as the right to have pets or smoke in the apartment.

Plus, it also defines any changes in wall paint or furniture change at the request of the tenant.

rental agreement brought to court for decision

Security Deposits

Most landlords ask for security deposits before giving the property for rent; it is the landlord’s right to request it and the tenant’s responsibility to pay it. It also highlights the amount, when it should be paid, and when the landlord will return it.

Termination

This clause explains the time the contract will end. If the landlord has any problem with the tenants, how much notice will be provided to leave the property, is also mentioned in this clause.

Utility Bills

This clause defines who will handle the paying of utility bills like water, gas, and electricity.

If you are the landlord using a tenancy agreement template is highly recommended as it helps you to include all the standard clauses.

Moreover, the document clearly defines how tenants and landlords should deal with one another.

All this protocol is highly beneficial because it will protect the interests of both parties. 

So, you must have a good understanding of tenancy agreements, if you plan to become a tenant or rent a property.

Do I Need A Tenancy Agreement?

If you are a landlord, who wants to rent his place, or you are a tenant looking for a property you’ll definitely need a tenancy agreement. This written document will protect your rights whether you are a landlord or tenant.

Furthermore, one more that comes to mind is, what documents do I need to rent a flat, well you must have your insurance number along with an identity card and police record to rent a flat.

As a landlord, it is beneficial because it will allow you to define with the tenant how he/she will take care of the property. As the tenant, it will allow you to use the property as you like while staying within the boundaries agreed with the landlord.

Often, a real estate agent is also involved in the process. The agent will ensure that the written document includes all the necessary information.

Plus, extra attention must be put on the break clause tenancy. The break clause will define the terms for breaking or going against the tenancy agreement clauses.

Why Do You Need A Tenancy Agreement?

It is essential for both parties to understand the rights of each other, and due to this reason, the contract is of great importance.

If you mention all the details like rent payments, utility charges, essential requirements, etc., then you will be protected from disputes and unnecessary discussion during the tenancy period.

Moreover, tenants must understand their rights and obligations after signing the contract. As it also explains your relationship with your landlord and any specific provisions. 

This document’s objectives are to make both parties comfortable and to have a sense of security in the living situation by defining clauses and sub-clauses of the agreement.

What Are the Requirements of a Tenancy Agreement?

There are multiple requirements of the agreement which must be followed for the smooth working of the contract. 

Following are some of the major requirements, which must be added while writing the contract:

  • All the essential details, including the names of the landlord and tenant
  • Must include the tenancy terms
  • Must display fees and security deposits
  • State the amount of the Rent payments
  • Define subletting options and alterations to the property
  • Define repairs & maintenance responsibilities
  • Restrictions on pets
  • Laws around overnight guests

    What Documents Must The Tenant Receive?

    If you are a tenant, you must keep in mind that there are some essential documents you must ask for from your landlord before entering the property.

    Having these documents is for your own safety, and you must check them properly. This includes all the information related to the contract, safety records and certificates. 

    So, it is the landlord’s responsibility to provide the tenant with the following documents:

    The first and most important document that the landlord has to provide is the agreement document. It is the right of the tenant to have a physical or digital copy of the signed agreement.

    Apart from the significant clauses, the agreement must have the following documents:

    • The name of the landlord
    • The address of the property
    • The telephone number of the property
    • The contact details of the landlord. (Address, phone number)
    • An agreement of lease
    • A copy of the last rent receipt
    • A statement of the property’s condition. Is it clean and habitable?
    • A statement of the condition of the roof, the walls, the floors,  the windows and of the doors

    Gas Safety Certificate

    The landlord must provide a copy of the gas safety certificate at the beginning of the tenancy and ensure that the certificate is renewed every twelve months. The certificate is not required only if the property has no gas facility. 

    Energy Performance Certificat

    The landlord must provide the ECP certificate, which provides all the details related to energy, which includes energy efficiency and estimated energy costs. So, as a tenant, you should have this certificate as well.

    What Does A Tenancy Agreement Cover?

    This contract generally covers the tenancy terms and each party’s duties and responsibilities. It also contains the rules tenants and landlords must follow and any applicable penalties for breaking those rules. You can also check this article on the different types of tenancy to get more information about the different agreements the parties can stipulate.

    Furthermore, the document also covers the following important things:

    • Utilities or other services provided by the landlord
    • Notification requirements in the event of changes or terminations to the tenancy

    These are some of the most important factors that must be added to the contract paper for having a smooth tenancy.

    What to Look Out for in a Tenancy Agreement as a tenant

    As a general rule, in life, is better to have a complete understanding of what you are doing before taking the next steps, the same goes for this type of contract. 

    It can reduce risk and help you find the best place to rent. Before taking your final decision on rent the house, you must ask for the written agreement and scan it properly. 

    It is essential to read the whole agreement before signing it, as, once signed, its terms, clauses and specificities will legally bind you. 

    Thus, try to read the entire document by yourself, or, if you want an even greater level of certainty about what you are going to sign you can look for a lawyer and ask him/her to check this matter in detail. 

    In case you cannot find an agreement with the current landlord then you can easily find multiple properties on several online platforms click here for more information

    person signing a tenancy agreement

    What Should Be In A Tenancy Agreement?

    If you’re a landlord having a property to rent, it is essential to have a written rental agreement. As stated before this is beneficial because if you and your tenant ever have a legal dispute, the chances of a favourable outcome improve if there is a written agreement. Following are some essential points that should always be included in the contract. 

    Information of Both Parties

    First, you must add the name and contact information of the tenant living at the property. Plus, also add your name, contact information, and the whole address of the property.

    Term of Tenancy

    The second thing you should add is the tenancy term, highlighting the time frame for the tenants staying at the property. Plus, starting the rental period on the first of the month is highly suggested, which will help minimize the confusion.

    Rent and all Security Deposits

    The third most important thing that must be added is the total amount of rent and the security deposits. The contract must have a proper clause highlighting the amount of both these things. Plus, it should also mention the last date of submission of rent.

    Landlord’s Access to Property

    It should also explain that the landlord can give the notice to enter the premises for repair, maintenance and inspection purposes. Nonetheless, the landlord must inform the tenant before visiting, so the tenant knows that landlord is going to visit and can plan accordingly to be at the property at that time.

    Important Rules

    The landlord can add some rules, like no illegal activities, no smoking on the premises, and no noise after certain hours. After signing the agreement, it should be the responsibility of the tenant to follow all the rules mentioned in the agreement.

    Damaged Property

    The document should also state that the tenant will be responsible for any damages to the property, and it would be his responsibility to get the damage fixed.

    Signatures

    Last but not least, there must be a proper space for the signature of both parties at the end of the document.

    non-assured shorthold tenancy

    Types of Renting Agreements

    There are usually three types of agreements between landlords and tenants. Is good to remember that it is the landlord’s responsibility to provide a copy of the contract to the tenant.

    Following are the three major types of rental agreements:

    Month-to-month agreement

    It is the first type of contract; in this type, the rental agreement does not have a specific time limit. The tenancy remains until one of the parties issues a proper notice to terminate it or vacate the residence. This notice is given before 20 days so the counterpart can settle itself for future procedures. It is also called a periodic tenancy.

    One-way lease

    It is a month-to-month agreement where the landlord can charge the termination fee and waive the deposit if the tenant wants to terminate the contract or moves out before a specific period.

    Fixed-term

    It is the most common type of agreement because it allows having a deal for a specific period. This contract usually comes in writing, and the duration in most cases is 1 year.

    What Is The Most Common Tenancy Agreement?

    The most common type of tenancy agreement is fixed-term, which usually lasts one or two years. Tenants have the right to live on the property during this period and are responsible for all rent payments and maintenance expenses.

    What Is a Non-Assured Shorthold Tenancy?

    The non-assured shorthold tenancy is an agreement in which both parties can end the agreement anytime, with or without notice. This type of tenancy agreement is the one providing the least protection to the tenants and landlords. Thus, it is the least common type.  Although a license tenancy is essential in a non-assured shorthold agreement, as it doesn’t provide rights to both parties. 

    Furthermore, in this agreement, tenants have no recourse if their landlord ends their tenancy early or fails to address property issues.

    The landlord also lacks certain rights under this lease arrangement, plus you can check our article on the lease option for further assistance if the tenant is responsible for damages or repairs.

    So, if you are looking for minimum commitment and maximum flexibility, then this agreement is ideal for you. 

    Excluded Tenancy Agreement (For Lodgers)?

    It is a type of tenancy in which the tenant continues to occupy the property even after the end of the contract. Although it is against the law, the landlord can take action against the tenant. But the restrictions outlined in the agreement still apply during an excluded tenancy. The landlord has the right to control the property’s access and can end the tenancy at any time.

    old man signing an excluded tenancy agreement

    Moreover, due to this reason, excluded tenancy agreement is considered unsafe and is not recommended at all—That’s why landlords and tenants have to observe all clauses of their agreement to avoid any disputes.

    What Is an Assured Shorthold Tenancy?

    An assured shorthold tenancy (AST) is a type of agreement that provides specific rights to both tenants and landlords. It is different from the periodic tenancy because it allows both parties to cooperate mutually and respect the boundaries set by each party. Its period varies from six to twelve months.

    The main advantage of an assured tenancy is that it offers legal protections to both tenants and landlords. For example, renters have the right to remain in their homes until a violation of the law occurs.

    Furthermore, the landlords are protected from all the market fluctuations that could cause them financial problems. So, an assured tenancy is highly beneficial for both parties.

    What Is a Regulated Tenancy?

    A regulated tenancy is basically a long-term agreement between a tenant and a landlord. In this agreement, the living conditions of both parties are regulated by law. It allows the tenants and landlords to communicate with each other and agree while considering the ease of both.

    It includes the length of residency, rental amount, and other essential clauses like rules and regulations. 

    Moreover, this type of contract also requires some other specificities, such as being a long-term resident or living in government-subsidized housing. Although this agreement is quite strict, it provides security and stability to both parties. So, if you want peace of mind under the action of law, this type is ideal for you.

    Can I Write My Tenancy Agreement?

    If you are a landlord, you must wonder if you can write your tenancy agreement by yourself. Well, the answer to your question is YES, you can write the contract.

    Although a landlord or property manager is given the right to write the contract, it is essential to be as transparent as possible.

    Furthermore, the agreement must include all the necessary details, such as the lease length and the tenants’ responsibilities. It is also essential to write all the fines, penalties or consequences that may apply in case of a breach of contract or any other violation.

    Last but least, the contract must be reviewed by a legal professional before signing it so that you can be sure that it follows all the laws and has all the essential clauses. It will ensure that the agreement represents all the needs and expectations of a landlord while providing legal protection to the tenants (click here for more information)

    Express Terms of Tenancy Agreements

    A tenancy agreement has specific terms expressed in the form of clauses. Following are the essential terms that must be present in the contract. 

    The clause mentioning the obligation to pay rent

    The first clause in the agreement is the obligation to pay the rent at the decided date. Plus, it clearly states the fine implemented if rent is not paid.

    The clause stating “Quiet enjoyment” and “Exclusive Possession”

    This term is for the landlord. it means that he should give the tenant the freedom to exercise his right of occupation and the full benefits of the property. This gives the right to the tenant to live freely on the property.

    The clause stating “Fair Wear AND Tear”

    This clause obligates the tenant to keep the place in good condition and make repairs if any break occurs during his stay. 

    The clause mentioning “Alternations or Additions” to the property

    This term implies that the tenant is not allowed to make any changes or alterations to the property without the landlord’s consent. Essentially, the tenant is not allowed to change the structural nature of the property unless the landlord permits it.

    What Is a Written Tenancy Agreement?

    There are two main types of tenancy agreements: written and verbal. These both have pros and cons, but the most used type is the written one. It is also referred to as a long-term agreement and is considered the best choice for tenants and landlords.

    Lease agreement on a blackboard

    Furthermore, it provides clear guidelines for both parties involved, including everything from rights and responsibilities to tenancy terms. It can help to ensure that everyone is on the same page and that there is no misunderstanding or dispute. 

    Moreover, a written contract provides additional protection to both parties by outlining specific terms that cannot be changed or violated by any party.

    What Is a Verbal Tenancy Agreement?

    If no paperwork is involved during a contract, it is referred to as a verbal agreement. This type of contract is sometimes more convenient in certain situations, especially when renters are looking for short-term accommodation or don’t feel comfortable signing formal documents.

    Moreover, it is quite time-consuming to make a detailed written contract. As there are certain legal complications or restrictions along with tenancy fees which are implied on both parties;

    Although it doesn’t matter whether you choose a written or verbal contract, the main thing that must be kept in mind is to respect the boundaries of each other for a smooth living environment. 

    So, if you are a tenant looking to rent an apartment or a landlord going to rent his property, then you must read the landlord-tenant act 1954 to better understand your right as a tenant and landlord.

    What Are the Implied Terms of The Tenancy Agreement?

    There are multiple implied terms which are present in the agreement. There are some important details that must be added to the contract for a smooth relationship between tenant and landlord. These terms are the terms and conditions set by both parties.

    These terms include the rent amounts, payment schedules, permission to use the property, restriction on changes, repairs or maintenance responsibilities and formal notification before making a visit.

    If the parties agree on a periodic tenancy agreement, they can also include additional terms and conditions not present in the lease agreement. Many other terms are also added in the document, like restrictions about changing locks or any permanent changes in the area without the landlord’s consent. 

    young man signing a tenancy agreement

    Do Lease Agreements and Tenancy Agreements Differ?

    Yes, these two terms are quite different, although they are considered identical.

    A tenancy agreement is a contract in which the tenant pays the landlord and gets to live on his/her property in return. Whereas a lease agreement establishes the rights and obligations of the landlord and tenant during property use transfer. 

    The main difference is the duration of the period, as lease agreements are short termed, whereas tenancy agreements can run for years. 

    The other difference is that the lease agreement could also be used for things like electronics or cars, but the tenancy agreements are signed only for property matters. 

    Conclusion

    If you are a tenant looking for a house to rent, or a landlord, who wants to rent his property, then you must have knowledge of the tenancy agreement

    The tenancy agreement is a contract which could be either in written or verbal form, that highlights the rights and responsibilities of both parties. It also states the rental amount, stay duration, restrictions, and property rights. Thus, signing an agreement before renting any property is highly recommended to save yourself from any inconvenience in future.

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