We’re serious about tenancy agreements. In fact, we don’t offer landlord insurance to people without them*.
A residential tenancy agreement is a contract between you and your tenant(s). It sets out, clearly and without room for misinterpretation, what is expected of the landlord and the tenant, and the length of the agreement between both parties. It also explains what they can do if the other person doesn’t uphold their agreement.
Without one in place, landlords and tenants have no written record of their contract, when the tenancy started and how much the rent amount is. This leaves them with fewer legal options if a dispute occurs. Rental agreements are about protecting the legal rights of both parties, and everyone benefits from having one in place.
That said, there’s sometimes confusion around what should be included, and which type of agreement is best to use. In this post, we’ll clear up a few of these questions and explain where you can find a template you can trust.
When the Renters’ Rights Bill becomes law (sometime in 2025) the Assured Shorthold Tenancy will no longer exist. All existing and new tenancies will be under new statutory rules and consequently tenancy agreements will need to change. Until then the existing agreements apply.
The Renters' Rights Bill will bring change to tenancy agreements in England to take account of the new rules, including:
The Bill aims to give tenants more security and stability, while also providing more straightforward regulation for landlords.
See our Renters’ Rights Bill hub for more details on the Bill and each of its provisions.
The majority of private rented sector landlords use an Assured Shorthold Tenancy (AST), which is currently the default legal category of residential tenancy in England. In Wales this was changed to a standard occupation contract on 1 December 2022 under the Renting Homes (Wales) Act 2016, while Scotland uses Private Residential Tenancy agreements.
There are other kinds of tenancies, but since the majority are ASTs we’ll focus this article on them for now, until things change in 2025. Certain kinds of properties, such as HMOs, may also have different tenancy agreement requirements but basically, the agreement is the same. See our guide to HMO tenancy agreements for more information.
The basic principle is that, provided the tenant complies with the terms of the contract, their tenancy is protected for the agreed period. Once this period is over, the landlord is entitled to get their property back.
ASTs can only be used by private landlords or housing associations and the landlord can’t live in the property that they’re renting. The rent must be above £250 a year and below £100,000. GOV.UK has more detailed information on the criteria for ASTs on their website.
If you’re planning to create a tenancy, your rental agreement should capture, in plain and unambiguous language:
As a general principle, you should be as specific as possible about everything you want the tenant to know or do. This may include:
Most new ASTs last for six months to a year. You can choose to offer one for as little or as much time as you want, although this is considered unwise, unless you add in a break clause.
Six months to a year gives landlords the flexibility to take back possession using a Section 21 notice within a reasonable timeframe should they need to.
When the fixed term of the AST runs out, and the tenant remains in the property without a new or renewed contract, a periodic tenancy will take effect.
The terms and conditions for the periodic tenancy remain the same and can continue indefinitely. However, the landlord can now regain possession of the property once the correct written notice has been provided.
If you do choose to use a template, make sure it is from a trusted source, like the free Government provided Model Tenancy Agreement GOV.UK.
Some landlords may choose to adapt or add clauses to tailor the contract to their property. If you are adding your own clauses, you may wish to seek legal advice.
Added clauses that are not legally enforceable or considered fair may land you in trouble under Unfair Contract Terms legislation.
If you’re looking for help, our partner eviction and housing law specialists, Landlord Action can assist with writing and reviewing tenancy agreements. They offer two packages for landlords.
1. You draft the AST yourself and Landlord Action review and offer suggestions where necessary
2. You tell Landlord Action your requirements and they draft the document for you
You can find more information on both services on their website.
Your agreement is a legal contract, which means it can’t be changed without the tenant and property owner agreeing to those changes and signing an updated contract or making written changes to the existing one.
Generally, signing a new contract is considered better as there’s less room for misinterpretation.
There are a few reasons you may want to terminate your contract early.
The simplest of these is that both parties agree to end it early, for whatever reason. If this happens, it’s best to capture in writing at the time what the reason was and that both parties are OK with ‘surrendering’ their agreement.
A ‘break clause’ allows the landlord or the tenant to end the tenancy early provided that sufficient written notice has been served beyond a given date.
For a 12-month contract, a break clause of six months may be included. The exact notice period, the terms of the break clause and how it can be activated must all be included in the tenancy agreement.
The only way you can end a tenancy early without a break clause is if the tenant has breached the terms of the tenancy agreement.
Typical examples include falling behind on monthly rent payments, intentional damage to the property or inappropriate behaviour towards other residents. The landlord will initiate this termination by providing written notice via a Section 8 notice.
Even if the tenancy has run its course and is ending according to the dates in the agreement, it’s still recommended that either the tenant or landlord provide notice that the tenancy is ending. This helps avoid any misunderstandings or assumptions.
When it comes to legal documents, it’s always better to be safe than sorry. Understanding the rights and responsibilities of both parties and how the tenancy agreement supports those things is important.
If you don’t take these things seriously, you can end up with fewer legal options in the event of a dispute over damage to the property, tenancy deposits or monthly rent payments being late.
It’s important to remember that you need to show that the tenant had an opportunity to read and understand, and if necessary, question the terms before agreeing to it – by signing.
A legal and binding contract is a great starting point, but for total peace of mind, you want to know that you’re covered for any eventuality.
Total Landlord Insurance offers comprehensive buy to let cover at a reasonable price. For a competitive quote and to discuss your insurance needs call 0203 907 1779 or get your landlord insurance quote online. With a dedicated claims team and decades of expertise, Total Landlord offers tailored policies to safeguard your property and your profits. Total Landlord was also voted 'Best Landlord Insurance Provider 2024’ by our customers for the seventh time at the Insurance Choice Awards.
*As we mentioned earlier, we can only provide you with landlord insurance if you have an Assured, Assured Shorthold or Regulated Tenancy Agreement (England and Wales) or Short Assured or Assured Shorthold Tenancy Agreement (Scotland) in place.
