Tenancy agreements are an essential component in the life of any buy-to-let landlord or property investor.
If you are a landlord, it is important that you are familiar with the basics of tenancy agreements and how they operate to protect the rights of both landlords and tenants.
Take a read through our guide below to get acquainted with the facts.
What is a tenancy agreement?
A tenancy agreement is a written or verbal agreement between a landlord and a tenant that sets out the specific rights for both, such as a tenant’s right to live in a landlord’s rental property and a landlord’s right to receive regular rental income in return for letting out their property.
A written agreement is always preferable as it could help ensure that the rental conditions agreed between landlords and tenants are fully understood and fair for both.
Types of tenancy agreements
Tenancy agreements come in many forms and the right fit can depend on what type of property is being rented and who it is rented to:
- Assured shorthold tenancy (AST)
The most common form of tenancy is an AST. Most new tenancies are automatically this type.
- Excluded tenancy
Excluded tenancies tend to be used by landlords who live in the same property and share facilities with their tenants.
- Assured tenancy
Unlike assured shorthold tenancies – which give landlords the automatic right to repossess their rental property after the tenancy agreement expires and adequate notice is provided – assured tenancies do not provide landlords security of tenure and equip tenants with more protection against eviction.
What should be included in a tenancy agreement?
You should always ensure that the following information is included:
- Full contact details of both landlord and tenant
- Address of the property being let
- The start date and length of the tenancy
- The deposit amount and how it will be protected
- The rental amount agreed, when and how often the rent should be paid
- Methods for paying rent
- If any bills such as council tax and utilities are included/excluded
- Notice periods landlords and tenants must give when terminating the tenancy
A tenancy agreement will also include things such as landlord and tenant commitments and obligations; who is responsible for repairs; and whether sub-letting is permitted.
Agreeing the terms & conditions of the tenancy
It is vital that both the landlord and tenant are present to sign the tenancy agreement once it has been drawn up so that if there are any disagreements, it can be dealt with well before the start of the tenancy period.
In England and Wales, you do not need a written contract for a tenancy agreement to exist, but we would advise that both the tenant and landlord always keep a written copy of the tenancy agreement as it could be used as evidence in the future should you wish to clarify the original understanding of the tenancy terms and conditions.
Can a tenancy agreement be changed?
Tenancy agreements can only be changed if both the landlord and tenant are in agreement. If this is the case, all changes should be recorded in writing by either drawing up a new tenancy agreement or amending the existing agreement.
Ending a tenancy
The landlord should inform tenants in writing of their intentions as soon as possible. The type of notice period, however, will depend on the kind of tenancy that is in place.
By helping to clearly define the rights and responsibilities of landlords and tenants, tenancy agreements play an important role in keeping both parties happy, especially if there is a future dispute during the tenure of the tenancy.
What does London Shared offer landlords? Over 13 years’ experience in property management. We take care of the ins and outs of tenancy management.
We become your tenant and take the stress off your shoulders. So, you can focus on other matters.
Ready to give us a try? Call 020 7610 9004 or send an email for an obligation-free property valuation.