Top Ten Tenancy Agreement Tips

Today we have guest blogger Tessa Shepperson from Landlord Law with some very good advice on the types of tenancy agreements to use for your lettings.

Tessa’s Top ten Tips

1. Make sure you are using the right type of tenancy agreement. In particular if you are letting to a limited company, at a rent of over £25,000pa, if you live in self contained accommodation in the same building, or if you are letting rooms in a shared house. If you are not sure which tenancy agreement to use, follow the Landlord-Law Which Tenancy Guide.

2. Do not make the fixed term more than six months unless you know and trust the tenants (or you may have to wait a long time before you can get them out).

3. Make sure that the tenancy gives an address for the landlord in England and Wales (otherwise the agreement will not comply with section 48 of the Landlord and Tenant Act 1987 which means that rent will not be payable by the tenant). The address can be that of an agent if the landlord is living abroad or in Scotland.

4. If you have made the rent payable weekly, note that you have to provide the tenant with a rent book in the prescribed form (obtainable from from most large stationers).

5. The agreement should state clearly which payments (such as water rates, council tax and utilities) should be made by the tenant and which by the landlord. If any are payable by the landlord, provision should be made to increase the rent if these payments are increased, so the landlord is not out of pocket.

6. Do not use an old form of tenancy agreement. All publishers have had to amend their tenancy agreements to take account of the Unfair Terms inn Consumer Contracts Regulations. Some clauses previously in common use will now be deemed and unfair and unenforceable.

7. Do not try to amend an agreement yourself without taking legal advice. You may find that the clause you have amended has actually been invalidated becuase you have not taken into account the requirements of the regulations.

8. If you are taking a deposit you will need to have this protected under one of the government approved tenancy deposit schemes, and inform the tenant using the proper form within 14 days of taking the deposit. If you do not do this there are severe penalties.

9. You should always prepare a detailed inventory giving details of the property contents and condition, and check this over with the tenants and agree it before they go in, and when they leave. This should be done even if the property is let unfurnished as it should include matters such as carpets, walls, doors and light fittings and their condition. If there is no inventory you will find it very difficult to justify any deductions from the deposit in any arbitration.

10. Most important of all – make sure the tenants have signed the tenancy agreement and that you hold the tenancy agreement with their original signatures (ie not photocopies, or a faxed or scanned copy) before you hand over the keys and they are allowed to occupy the property. They should be given a copy of the tenancy agreement with your original signature on it.

Final Myth Busting Comment

Lastly, it is also wise to note that when a tenancy agreement runs out it is not necessary to renew it by getting them to sign another document.This is a myth largely created by letting agents, as an important part of their income stream comes from charging landlords for ‘renewals’ for tenants. But they are not actually necessary. Assured and assured shorthold tenancies continue automatically after the end of the fixed term, as either a monthly or weekly ‘periodic’ tenancy, depending on how the rent is paid.

The most important reason for ‘renewing’ a tenancy is to increase the rent. This is often done at this time, as if a tenant signs a new tenancy agreement or renewal form with the new rent, they cannot then challenge the rent figure if they think it is too high.

These tips are from Tessa Shepperson’s website a Landlord Law

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