6 Tenancy Agreement Facts That Are Bullshit
Written by The Landlord on 21 Jul 2010
1) You can’t let a property without a signed Tenancy Agreement
Landlords don’t need a written Tenancy Agreement in order to legally let their property, although it is strongly advised. A tenancy Agreement can actually be an oral agreement, but it’s an extremely unsafe option.
Generally, if a tenant pays less than 50k per year in rent, moved into the property on or after 28th February 1997, is renting from a private landlord and has rights to have privacy in the property where the landlord cannot enter the property without mutual agreement, then an Assured Shorthold Tenancy is automatically created, with or without a tenancy agreement.
2) You need to renew a Tenancy Agreement when it expires
Apparently this is rumour is strongly endorsed by letting agents so they can charge “renewal fees”. The fact is, it’s perfectly legal and valid for a tenancy agreement to continue even after the fixed dates in the tenancy agreement have expired. There’s no legal requirement to renew the contracts.
When a Tenancy Agreement expires, and is not renewed with a new contract, the tenancy becomes what is known as a Periodic Tenancy.
3) A Tenancy Agreement has to have a minimum of 6 months
I hear/read this statement all too often from people, even professionals with in the industry.
Before Feburary 1997, an Assured Shorthold Tenancy actually couldn’t be less than 6 months. But that changed after Feburary 1997; now it can be as short as 1 day. So no, the fixed dates in a Tenancy Agreement do not have to be at least 6 months.
However (here’s the kicker), there is a rule that says that possession orders are not enforceable within the first six months of a tenancy. So what this means is that a tenant can have a two month agreement, but the landlord won’t be able order for possession until after six months if the tenant wishes to stay longer than the agreed 2 months.
4) Only letting agents can legally create Tenancy Agreements
I’ve actually had a letting agent tell me this before! It’s a long and ridiculous story, but essentially, the letting agent wanted me to pay a renewal fee, consequently deemed it appropriate to lie to me in an attempt to back me into a corner.
Bottom line, letting agents are NOT the only outlet for legally creating tenancy agreements. You can download/purchase them from many outlets.
5) Tenancy Agreements need to be completed by a qualified professional
Again, complete rubbish. You can download a tenancy agreement from online, and fill in the missing spaces (tenant name, landlord name, rent etc.) for yourself. It will remain perfectly valid and legal! But bear in mind, most good tenancy agreements will require you to have witnesses present (they don’t need to be a qualified professional).
6) You can put any clause in a Tenancy Agreement
Absolutely incorrect. Before you consider adding your “home-made” clause into a tenancy agreement, you should ensure it’s legally valid.
Every clause in a tenancy agreement MUST be “fair” otherwise the landlord could fall foul of the Unfair Contract Terms legislation. Moreover, both landlords and tenants have statutory rights which are stipulated in the The Housing Act 1988. Clauses put into a Tenancy Agreement which conflict with statutory rights will be invalid.
It’s important to be diligent when adding clauses to pre-written/bought agreements as you may be inadvertently restricting your rights in law. If you wish to add your own clauses into an existing Tenancy Agreement it is recommended to seek advise from a professional.
Can you think of anymore?
Have you heard of any more myths relating to Tenancy Agreements? Let me know, innit!
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12 Comments - join the conversation...
Re: 3) Can the 'fixed' date on the actual Tenancy agreement be changed from 6months or 12 months to say 2 months then? I was always told that I couldn't and if I did then the contract would become invalid.
Thought I should ask you for your opinion.
Regards.
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An AST can definitely be less than 6 months! However, the tenant has a statutory right to remain in the property for a minimum of 6 months!
If you look in The Housing act 1988 it says that the minimum must be 6 months. But in The Housing Act 1996, it changed (in Chapter II Section 96/97 that condition is no longer there):
http://www.opsi.gov.uk/acts/acts1996/ukpga_19960052_en_9#pt3-ch2-pb1-l1g96
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My mortgage company told me that the 12 mth AST had to be done by a solicitor and has to be done every year- can they do this?
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Not true. Anything you put into a tenancy agreement MUST be fair otherwise you will fall foul of the Unfair Contract Terms legislation. Clauses such as prohibiting pets, cutting flowers in gardens, fitting of sattelite dishes/ariels to premises must contain the phrase "permission not to be unreasonably withheld" to avoid the courts making a fool of you.
Prohibiting cutting flowers would include weeding so if your Tenant allowed the garden to become overgrown then there is nothing you can do about it!
Be very careful when adding clauses to prewritten/bought agreements as you may be inadvertently restricting your rights in law.
Jools
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That's a good one and an extremely common myth! I've read about a few "home-made" clauses before!
It's been thrown into the pile! Lovely!
Cheers!
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Thanks for this wonderfull list. I agree , agreement is very important unless you have problem like that:
I rent out my property to my daughter in law, so we have'nt signed a new tenancy agreement in 4 years but still have the original. I want to sell the property as i am out of work and it is in a right mess. But the daughter in law said i cant kick her out because she has been there over five years and she can stay there as long as she likes is this right
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