A tenancy agreement is a legal contract between a landlord and a tenant
Both landlords and tenants should understand their rights and their obligations under the agreement.
Landlords should always:
- supply a written tenancy agreement to the tenant;
- understand their rights and responsibilities and those of the tenant;
- check it before it is signed as it is a legally binding document
Although landlords can draw up their own agreement this is not usually advisable.
Drafting tenancy agreements without legal advice may result in landlords finding they have actually made their position worse in the very areas where they were seeking to protect themselves.
It is far better to use one of the many excellent standard tenancy agreements which are available from landlord accreditation schemes, landlord associations, law stationers, or the many online services available for landlords. Landlords wishing to alter the terms of a standard agreement should seek specialist advice.
What should appear in a tenancy agreement
- The key dates of the tenancy - the start date, how long the tenancy will last and the end date;
- The rights of both the landlord and the tenant(s) to end the tenancy;
- What the landlord is agreeing to do and how they will do it;
- What the tenant is expected or required to do and how;
- Any restrictions on what can be done with the property e.g. lodgers, subletting, smoking and pets;
- Who to contact if the tenant has a problem with the property;
- The rent amount, when it is due and how it should be paid;
- The address of the property;
- The name(s) of the tenant(s);
- The landlord (or agent's) address;
- Information on the deposit, what it covers and which deposit protection scheme you have used;
- Who is responsible for the bills like council tax, gas, water and electricity;
- Any services provided by the landlord e.g. cleaning or gardening;
Tenancy agreements - points to remember
With effect from 1st October 2015, at the start of a new tenancy, the landlord should provide a tenant with certain documents:
- A valid Energy Performance Certificate (EPC)
- An annual Gas Safety Certificate
- A copy of the Government publication: 'How to rent' Guide - see Useful links.
The landlord should supply these documents at the start of each new tenancy (or as soon as possible thereafter). If these documents have not been supplied, the landlord cannot serve a section 21 'notice requiring possession'. As soon as the landlord supplies these documents this restriction will be removed.
These regulations have been introduced as part of the Deregulation Act 2015 and also include requirements around tenant complaints to the local authority and possible 'retaliatory' evictions by the landlord. This type of action could also render a Section 21 notice invalid. Landlords are encouraged to familiarise themselves with these changes to avoid possible problems.
Landlords should also be aware that:
- with a joint tenancy agreement all tenants are all equally responsible for complying with the conditions of the agreement. So if one person doesn't pay their share of the rent the others will have to pay it for them.
- if the agreement contains any unfair terms these are not legally binding e.g. the landlord stating they can come round when they like without giving notice.
Right to Rent checks
From 1st February 2016, for all new tenancies the landlord must undertake a Right to Rent check on all adults who will be living in the property being rented - this includes sub-lets and for lodgers. The checks require landlords to verify the immigration status of prospective tenants and lodgers before they move in, to avoid the liability for a civil penalty (fine)
The process is straightforward and can be carried out quickly - landlords in the West Midlands have been making these checks since October 2014. Copies of the evidence, for example a passport or a biometric residence permit, must be retained by the landlord.
If a tenant has an outstanding immigration application or appeal with the Home Office, landlords can request a Home Office Right to Rent check which will be returned within two working days.
Landlords who employ a letting agent to manage their properties should satisfy themselves that these checks are being carried out as part of the service they receive. Civil penalties (fines) of up to £3000 per tenant can be levied on landlords by the Home Office where these new rules are not complied with.
On 1st December 2016, two further changes were introduced:
- landlords could be charged with a criminal offence if they know, or have reasonable cause to believe, that they are letting to an illegal migrant;
- landlords can end tenancies for occupants with no right to rent, but must follow the correct procedure.
The GOV.UK website has more information and guidance about the scheme, the penalties and a code of practice for landlords (see Useful links).
Tenancy agreements - end of the tenancy
- The tenancy agreement will normally be for six months and will state the end date of the tenancy. If you wish for the tenancy to end you should give the tenant appropriate written notice to leave on this date;
- The landlord can issue another tenancy agreement if they are willing to re-let to the current tenant for another fixed term; or
- The tenancy will automatically continue on the same basis but will roll from month to month if the landlord decides not to issue a new tenancy agreement.
Landlords should be aware of legislation to protect tenants who are renting properties where consent has not been given by a mortgage company. The document - Guidance to the Mortgage Repossessions, Protection of Tenants Act 2010 is available in useful links.