A shocking number of landlords are missing these critical clauses in their tenancy agreements!
The majority of self-managed landlords are not adequately protected from a legal standpoint when renting out a property. The law leans towards the tenants' side, so, as a landlord, you have to be on the ball to win in court. Do you know if your tenancy agreement would stand up to a judge if you needed it to?
You may be surprised to learn that there is actually no legal obligation to have a written or signed tenancy agreement in place when renting a property. If there is an arrangement between a landlord and a tenant, the tenant has access to the property and is paying rent for that access; there is an implied tenancy agreement in place. But, as with all things legal, it is much better to have the rules written down and all parties sign so there are no grey areas.
You could simply have a piece of paper that says, "I, landlord, allow you, the tenant, to live in my property for £XXX per month."? It's better than nothing, but it still wouldn't legally cover you or your tenant as well as it could.
The average tenancy agreement will be around 10 pages long, with clauses covering all eventualities, protecting you, your property and the tenant's rights. In any dispute, this tenancy agreement will help you to manage things properly and reach a suitable outcome.
So, if a tenancy agreement is advisable, even if not a legal obligation, what clauses should you make sure you include?
- Rent. Starting with the most obvious, the rent should be noted. The amount, the date it is due, who it should be paid to and how. Leave no questions or ambiguity to avoid rent arrears and any potential issues.
- Deposit. There are rules about how much deposit a landlord can charge and where or how that money can be held. This information must be noted in the tenancy agreement so that the tenant knows how to get that money back at the end of the tenancy, or indeed how they may lose some or all of that deposit money in the event of a claim.
- Cleaning. Laying out from the outset the expectation during the tenancy and when the property is returned is essential. If you do not have this written down clearly, without any ambiguity, you will struggle to claim the deposit funds at the end of the tenancy if needed.
- Pets. Outline what you will allow in the property. If you allow pets at all, how many? What breed? What size? If you don't lay your own parameters, your property could end up a doggy daycare for twelve dogs, and there would be very little you could do about it. Many tenants have a pet, and new guidelines are that landlords should not unreasonably deny a family pet, but that doesn't mean you have to allow an entire zoo of animals in the property.
- Decorating. You may decide you are happy for the tenant to paint a room or two during their tenancy, but your agreement must detail your position here. If you give a blanket permission for the tenant to decorate, they can do whatever they like. This could be a very tasteful interior design, but it could equally turn your property into a 'Changing rooms' disaster from the 90s. If you don't outline your expectations, then you won't have a leg to stand on if you end up with a zebra print and lilac combo that will put off every subsequent tenant viewer in the future.
- Sub-letting. You need to know who is living in the property throughout the tenancy. If sub-letting the property is unacceptable to you, it must be laid out in the agreement. This is a rising problem as tenants rent spare rooms to help with household costs.
- Key dates. Include a list of key dates the tenant needs to be aware of. These should include the following:
· Tenancy start date.
· Rent due date.
· Any rent review dates.
· When the fixed term of the tenancy ends.
Your tenancy agreement should outline what you expect of the tenant and what the tenant should expect from you as a landlord from the outset. This will avoid disputes or issues later down the line and protect you and the property if you must go to court.
Be clear and concise, and ensure the tenant understands and agrees to the tenancy agreement's clauses. The best way to achieve this is with a witnessed signature from the tenant.
Most self-managed landlords are not adequately protected and would be unable to regain possession of the property in court or claim the deposit funds for repairs after the tenancy agreement ends. Don't leave yourself exposed; speak to the professionals.
If you would like some guidance on how best to manage your tenancies to protect you and your property, contact our team of property letting experts.