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Top 10 things to know about tenancy agreements

Posted 26/06/2019 by Your Move
Categories: Landlords
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The tenancy agreement sets out the terms and conditions of a let, importantly, the rights and responsibilities of landlords and tenants. In England and Wales, the standard agreement is an Assured Shorthold Tenancy (AST), which is what we’re looking at here. In Scotland, it’s a Private Residential Tenancy – more information on this can be found on the Scottish government website.

  1. Are you using an up-to-date version? Lettings laws can change fairly often and that might result in clauses, terms and conditions in the tenancy agreement having to be changed as well. So, always check that the version you and your tenant are signing is the latest one. If we are letting and/or fully manage your property, the tenancy agreement will be updated to protect both tenants and landlords.

  2. Statutory law applies, regardless of what’s stated in the tenancy agreement. Laws passed in parliament are legally binding and enforceable, even if they’ve been left out of the signed tenancy agreement. In the same way, if you add a clause that contravenes a tenant’s statutory rights, it won’t be valid - regardless of whether the tenant has signed the agreement. Indeed it could be considered as an ‘unfair term’ or clause, for example, trying to ask the tenant to ‘repaint the kitchen’ or change the notice period.

  3. Tenancy agreements can be verbal. Because various rights and responsibilities are statutory, once a Landlord has accepted rent from a Tenant it can become legally binding, even if there is no written agreement. But problems can – and do – tend to arise if there’s no written agreement, because there’s no way of proving what terms were agreed at the start of the tenancy. And if you have a mortgage it’s likely and sensible to only use a signed formal, clear Assured Shorthold Tenancy (AST).

  4. Length of agreement. The initial fixed term of a tenancy under an Assured Shorthold Tenancy is a minimum of six months and typically a maximum of 12 months, after which it can be renewed by signing an new Assured Shorthold Tenancy or simply become a ‘periodical’ or ‘rolling’ tenancy, which can be ended at any point by either party giving the required notice. As lenders are being more flexible on their mortgage product offering, some will now allow up to three year tenancies.

  5. Notice to leave. Assuming no terms have been breached, the landlord must give the tenant a minimum of two months’ notice to leave by way of the issuing of a Section 21 notice. The tenant must give the landlord a minimum of one month’s notice, in writing. You cannot ask a tenant to leave until the end of the initial fixed term of the agreement, so if it was signed for a minimum initial term of 6 months, the earliest you can issue a notice to leave is month four of the tenancy.

Other key information:

  1. All rent-related information. This includes the amount, when it’s due and the payment method. If you want to charge interest on late rent, make sure you state the interest rate and when and how it’s applied.

  2. Any services and utilities that are included. If you’re including things like council tax and broadband in the rent, this should be clearly stated.

  3. Maintenance responsibilities. As standard, there should be details of expectations for the tenant keeping the property wind and watertight and protecting it against condensation and frost damage. Anything else that the tenant’s responsible for, maintenance-wise – e.g. mowing the lawn – should also be included.

  4. Additional clauses and documents. For instance, if you’re allowing a pet in the property, terms should be either inserted as a clause in the agreement or set out in a separate document that’s referred to in the agreement.

  5. Deposit information. Details about where and how the tenant’s deposit is protected should be included in the agreement. Be aware that if the deposit isn’t protected correctly and/or the required prescribed information is not given to the tenant, this could affect your Section 21 rights to end the tenancy.

We have already made three changes to our tenancy agreement this year to ensure it remains legal, so if you’d like to discuss anything relating to the terms of a tenancy, just contact your local Your Move branch and one of the team will be happy to help.

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