When you, as a landlord, first rent out your property, it's important that you protect yourself, and your financial position, by creating a tenancy agreement when the tenancy starts.
A tenancy agreement sets out the landlord's and tenant's obligations to each other and it prevents disputes between you and the tenant in future. It sets out when the tenancy starts, the amount of rent and the length of the tenancy.
Here is an outline of what terms a rental agreement should include:
Date of agreement
The tenancy agreement can be dated at any time after you and the tenant have signed it. This date should be the same as the date on which the term is to begin.
Property address
When you're completing the terms of the rental agreement, it's useful to include details of any parking spaces which may go with the property.
Designated room and the shared parts
This term should be included if the property resides in England and Wales only and if your tenancy is for individual rooms
Landlord's address
For assured shorthold tenancy agreements it's important that the tenancy agreement gives an address for you in England or Wales. This is because section 48 of the Landlord and Tenant Act 1987 states that rent isn't due until a notice of an address in England and Wales for the service of notices and documents has been provided to the tenant. If you live abroad or live in Scotland, there should always be a contact address given in England or Wales. If this isn't possible, you should consider using a letting agency. Although it's not a legal requirement for letting properties in Scotland, it's normal practice and prudent to provide a contact address in Scotland.
Tenant
Make sure that all the tenants are listed on the rental agreement and that they all sign the tenancy agreement.
Term
In England and Wales, this can be for any period of time (but bear in mind that an order for possession under the shorthold ground will not be granted by a court until six months from the beginning of the term). Note that in Scotland, the initial term of the tenancy agreement must be at least six months.
It's advisable that you don't make the term too long, particularly if you're letting to a new tenant; remember that you will not, generally, be able to get the property back during the fixed term, which could cause you difficulties if you have an unsatisfactory tenant.
In England and Wales, it's normal for the term to be six months. The tenancy will, unless a notice of termination is served, continue after the end of the fixed term. It's not strictly necessary to give the tenant a new fixed-term tenancy agreement. When a tenancy continues after the end of a fixed term, it's generally referred to as a 'periodic tenancy', the period being monthly or weekly, depending on how rent is paid.
In Scotland, at the end of the fixed term, if no new rental agreement is entered into and no notices of termination have been served, the tenancy continues automatically for the same term as the original term of the tenancy (e.g. if the tenancy was for seven months, it continues for a further seven months).
Rent
If the rent is too high, it may be subject to challenge during the first six months of the tenancy agreement in England and Wales. In Scotland, you can seek a rent determination from a Rent Assessment Committee at any time during the tenancy. If rent is payable weekly, you will have to provide your tenant with a rent book (failure to do this is a criminal offence) and you can save money by getting our Rent Book now, or it's available as part of our Residential Lettings Kit .
All of the tenancy agreement forms you need, both for England & Wales and Scotland, can be found in our Residential Lettings Kit . Drawn up by experts in tenancy law, the Kit also includes guidance on how to fill in the tenancy agreement forms and how to make a letting inventory .
