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Whatever type of property you’re letting, having a tenancy agreement in place is essential. Tenancy agreements are legally-binding contracts that protect both you and the tenant by setting out each individual’s responsibilities, thereby preventing disputes later on. Here are a few essential terms to include in your tenancy agreements.
1. Date of Agreement
The date of agreement is the date on which the terms of tenancy are to come into effect. this date can be any time after you and the tenant have signed the agreement.
2. Names of All Occupants
Every person living in the rental unit should be listed as an occupant and sign the tenancy agreement. This way, each occupant is responsible for all tenancy terms. If one tenant breaches a major term — such as not paying rent — you can terminate the agreement for all occupants. Be sure the agreement clearly states that the rental unit is to be occupied only by the individuals who have signed the lease. Doing so will prevent your tenants from subletting, and ensure only people you have personally screened live in your property.
3. Term of Tenancy
Your tenancy agreement should specify the rental term. While the tenancy can be for any length of time, it’s a good idea to keep the initial rental period short. Keep in mind that it can be very difficult to repossess the property during the initial rental term unless you can prove that the tenant is in serious breach of the tenancy agreement. In the UK, the initial rental term is usually six months. After the initial term, the tenancy will default to a ‘periodic’ tenancy — that is, a weekly or monthly rental, depending on how frequently rent is collected — until a notice to terminate is served.
4. Rent
Every rental agreement should state the amount of rent paid, when it is to be paid (this is typically the first day of the month) and acceptable payment methods, such as by cheque or direct deposit. Keep in mind that if you are collecting rent weekly, you are legally required to provide your tenant with a rent book.
5. Landlord’s Address
With Assured Short-hold Tenancy (AST) agreements — the most common type of tenancy in the UK — it’s critical that the agreement gives an address for you in the UK. The Landlord and Tenant Act 1987 states that a tenant is not responsible for rent until the landlord has provided an address in England or Wales for the service of documents and notices. If you don’t have an address in the UK, consider hiring a property management company to handle communications between you and your tenant.
Our tenancy agreement template is designed for Assured Short-hold Tenancy agreements and is written in compliance with the Housing Act. Download a free sample of this highly-customisable form today.
