The importance of a tenancy agreement

A written agreement or rental agreement is a key part of organizing a successful tenant.
Although most landlords have this covered, some private tenants may not have a written contract.

Tenancy agreements are legally binding documents that give the tenant the right of living in the rental property and the landlord the right of receiving rent.

It is therefore crucial that the tenancy agreements that landlords issue are current and legal.

Because of the rapid pace of the rental industry, landlords who do not employ a letting agent may be at greater risk of losing the contracts they are supplying.

We’ll be looking at the reasons why tenancy agreements matter and how to put them together.

Why is tenancy agreement so important?

Although it may not be required by law to provide a tenancy agreement for your renters, if you do intend to take a security deposit (which most landlords do), then it is in your best interests to have a written agreement.

You won’t be allowed to take possession of the property under the section 21 accelerated procedure if you don’t have a written agreement. A tenancy agreement is a key requirement to be able to issue section21 accelerated proceedings.

It is not the only reason why landlords need to have a signed tenancy contract. There are many other practical reasons as well.

First, it shows that you care about your tenants and you take your landlord role seriously by offering them a professional tenancy contract.

You can also set clear boundaries from the beginning – are tenants allowed to keep pets? Are they permitted to sublet the property to others?

Both you and your tenant can feel more at peace if you are clear about what you expect. This will reduce the likelihood of any disputes or disagreements later on.

What should a tenancy contract include?

An AST tenancy agreement must include the following:

– The property address
– All details for all parties
– The address of the landlord’s service
– How much rent the tenant will pay and how much it will cost.
– What scheme will it be protected by?
– The term of the tenancy.
Notice periods to end a tenancy
– The rights and responsibilities of each party
– A forfeiture clause that allows possession of the property if the tenant is at fault
– Any special arrangements

Tenancy agreements often include other items. The tenant’s right to sublet, the landlord’s obligation to give notice to inspect the property, who will be responsible for repairs, and whether the tenant can keep pets. There are many other things that are included in a tenancy agreement.

It is important to have two copies of any agreement signed and dated. The landlord should sign one for the tenant, while the tenant should sign the other.

Once a tenancy has begun, a landlord or tenant may make changes to the terms of the tenancy agreement. The other party must agree to this change.

How to make a tenancy agreement

Many landlords create their own tenancy agreements. It is important that the document is legal binding and up-to-date. If you create the document yourself, you should have it reviewed by an experienced property lawyer or letting agent to ensure it meets all legal requirements.

Most letting agencies and rental sector companies offer templates or sample agreements if you don’t wish to create your own tenancy agreement. A solicitor can draft a tenancy contract for you according to your requirements.

Tenancy agreements are a vital document in letting property. If you don’t have one or you are unsure about your current agreement, it’s worth taking the time to read the guidance provided by the Government or asking an expert.

Both landlords and tenants benefit from tenancy agreements, which reduce the risk of disputes or problems.

You can download a tenancy agreement Word Doc from Rentaldocs if you are a beginner landlord.