Although you have rights laid out in law, your tenancy agreement can give you additional rights. Having a clearly worded, signed tenancy agreement reduces the likelihood of disputes arising between you and your tenants and offers you both greater protection.
Tenancy agreements must comply with the Consumer Rights Act 2015 if they were issued after 1 October 2015 and the Unfair Terms in Consumer Contracts Regulations 1999 if they were issued before then. The Office of Fair Trading has produced useful guidance on the types of terms that could be considered unfair.
Implied terms and obligations
If you don't have a tenancy agreement or your agreement is not very detailed the law allows that some terms will be understood to apply to the tenancy.
Unless the tenancy agreement states otherwise, the tenant will be required to:
- ensure payment of rent and rates
- keep the premises in good condition and repair and
- give peaceful possession of the premises to the landlord at the end of the lease.
Unless the tenancy agreement states otherwise, you, as the landlord are required to
- not interfere with the tenant's occupation and enjoyment of the property
- ensure that furnished accommodation is fit for human habitation at the beginning of the tenancy
- keep all common parts in good repair
- ensure charges for services provided are fair and reasonable and
- ensure that premises which are let while undergoing construction are built with proper materials and in a workmanlike manner.
If you add a clause contradicting an implied term, the clause in the tenancy agreement will take precedence. However, it's important to remember that you cannot insert clauses in a tenancy agreement that will limit or take away from your tenant's basic rights.
Terms you must include
Your tenancy agreement should include
- the address of the property
- the name(s) of the tenant(s)
- your name, address and contact details
- the name, address and contact details of any agent you are using
- an emergency, out of hours contact number for you or for the agent
- the term of the tenancy, (whether monthly, quarterly etc)
- the tenancy start date
- the tenancy duration and the end date, if one exists
- the amount of the deposit and information explaining the types of deductions which can be made from the deposit (e.g. rent arrears, unpaid amenity bills, damage or neglect excluding fair wear and tear)
- the amount of notice that must be given by you or the tenant (unless the tenancy has a fixed term)
- the rent payable and dates payable and the method by which rent should be paid
- a statement as to who is responsible for payment of rates, details of the amount of rates which must be paid and whether this is included in the rent (NOTE: Rates can cause major complications in private tenancies, make sure you understand who is legally liable)
- the amount and purpose of any returnable, or non returnable deposit payable and the conditions under which it will be repaid
- any other payments beyond the rent (e.g. for heating)
- the repairing obligations of the tenant and you;
- details of any other obligations of both the landlord and the tenant
- an inventory of any furniture that is provided as part of this tenancy.
Additional terms for your agreement
In addition, you should considering adding terms which:
- explain your rights to enter the premises and the notice which you will give to the tenants before entering the property, which must be a minimum of 24 hours
- explain the liability of the tenants in relation to unpaid rent or damages caused by tenants or guests to the property
- agree a procedure for arranging viewings of the property in the final month of the contract
- prohibit the use of the property from commercial or immoral use
- address the tenant's rights to smoke in the property
- address the tenant's rights to have pets in the property
- specify whether the tenant can sub-let the property
- explain what will happen should the property become uninhabitable through no fault of the tenants (e.g. if there is a flood or storm damage).
Determining rental liability for tenants
If you are renting to more than one tenant, the wording of the tenancy agreement can have an impact on who is liable for rent or damages.
Many contracts specify that all signatories are "jointly and severally liable". This means that, in the event of a dispute, you may choose to pursue all or just one of the signatories for damages or unpaid rent. In theory, this means that if a tenant disappears you can expect the remaining tenants to become responsible for the missing rent.
If you include a term describing tenants as "jointly and severally liable" you must explain what this means in plain English.
Group tenancy agreement
You can draw up a tenancy agreement between yourself and a group of individuals. This means that the group, as a whole, is responsible for paying the full rental amount due on the property and adhering to the terms of the tenancy agreement.
This type of agreement can cause difficulties if one member of a group decides to leave the tenancy. The person who leaves can still be held liable as part of a group while his or her name remains on the agreement. If a sitting tenant wishes to leave and has found someone else to take over his/her part of the tenancy you should draw up a new agreement, naming the new tenant and make sure that the new tenant signs this.
Individual tenancy agreements with each tenant
If you are letting a property to a group, you can choose to have an individual agreement with each tenant. This can make things simpler if one tenant breaks the lease and allows you to have a new tenant take over the lease without impacting on your agreements with the other tenants.
If you choose to have individual tenancy agreements with each tenant, you must explain how this impacts on them and that, if one of the group chooses to leave, you have a right to add a new person to the tenancy.
Individual tenancy agreement with just one tenant
In some cases, a landlord will let the property to one person who will then invite additional people to move into the property. This means that an agreement to pay rent only exists between you and the tenant who has signed the tenancy agreement and this tenant is liable for the rent for the entire property.
If only one tenant is named on the agreement, the other people living in the house are licencees and not tenants. While the official tenant remains in the property the other residents share the basic rights afforded to the tenant by law as well as the rights outlined in the tenancy agreement. However, if this tenant leaves the remaining residents will only have the rights given to licencees. If the official tenant has left and you wish to regain vacant possession of the property you must only give the remaining occupants "reasonable packing up time by way of notice. You do not need a court order to remove these people from your property, but if they refuse to leave you should seek legal advice before attempting to evict them.
All of the terms included in your tenancy agreement must be fair to your tenants. If the Office of Fair Trading decides that a term is seen as unfair, it will be unenforceable. The Office of Fair Trading has drawn up a guide, which explains the type of term that could be considered unfair. Examples of unfair terms include:
- any term taking away the tenant's basic rights
- a term enforcing excessive charges on a tenant for late or non-payment of rent
- terms requiring the tenant to pay for or be responsible for repairs that are your responsibility
- terms allowing you to impose payment penalties on the tenant
- a term which allows you to decide if the tenant is in breach of the agreement
- any term asking the tenant to hand back the property in a better condition than when s/he received it (e.g. requiring a tenant to repaint the interior before vacating)
- terms allowing you to access the property without giving reasonable notice, (unless in an emergency)
- a term which allows you to keep the deposit at the end of the tenancy, unless you have suffered a financial loss that can be attributed to the tenant's actions
- a term asking the tenant to give Notice to Quit to end a fixed term tenancy
- any term requiring the tenant to do something which would be considered unreasonable.
Accessible tenancy agreements
You should make sure that your tenancy agreement is as accessible as possible. This means that it should be in a format which is appropriate to your tenant's needs and is written in language that the tenant can understand.
Tenancy agreements should be written in plain English and should not contain any overly complicated, legal clauses. The Office of Fair Trading states that if there is any doubt about the meaning of a clause, the interpretation which is most favourable to the tenant will prevail.
If your tenants do not speak or read English well, you should provide them with a tenancy agreement in a language which they can understand.
If your tenant has poor literacy skills, ensure that he or she fully understands the contract or provide the tenant with an audio version of the agreement, outlining the clauses in the contract and both your and the tenant's obligations. Failing to make provisions for someone who has a disability could be seen as a failure to comply with your obligations under the Disability Discrimination Act.