This is part three of our four part series in understanding your tenancy agreement!
When you find a property, sign a tenancy agreement and finally move in you often have no idea of the issues that could follow. Many of us don’t even read the agreement before we sign it and won’t read it properly during the entire duration of the tenancy – unless an issue arises (TTV recommends that you never do this btw). However, regardless of whether you have paid attention to the small print, if you break the terms of your tenancy agreement you can be removed by the landlord, you could lose some or all of your deposit if you cause damage, and you could even be sued. Below are a few of the most common situations in which tenants have been caught out.
Subletting. Didn’t realise that your lease didn’t allow you to sublet? Well if the tenancy agreement states you can’t sublet but you go ahead and do so – and make a profit from it – then your landlord may be able to take you to court to claim damages. If you are a tenant who is subletting from another tenant then, depending on the type of property, you will have far fewer rights than being a direct tenant. If you live in the same building as the person you are subletting from then you will have virtually no rights at all and you could lose any ‘deposit’ you pay, as well as having little protection against losing the roof over your head. Remember, where you are subletting, if your name isn’t on the tenancy agreement then you have none of the protection the document provides, even if you are paying the rent.
Verbal agreements. If you come across an issue with your landlord that is not covered in your tenancy agreement then the usual way to resolve it is to sit down and have a discussion. With a good landlord agreement can be reached but if you don’t have anything in writing then remember that you have little or no proof of the joint decision and the landlord can turn around at any time and say that it was never made. This also applies to a situation where the tenancy agreement prohibits something – for example keeping pets – but the landlord has agreed you can have a dog. Unless you get that in writing then the landlord can force you to get rid of the dog or move out. If this situation arises before you sign the tenancy agreement then insist that whatever has been agreed is added to the tenancy before it is signed.
End of tenancy cleaning. Many tenants move in to a property without taking any notice of the requirements for when they leave. If your lease states that the property must be returned in the condition it was rented in then make sure you note the state of the property when you move in. If there is to be no professional clean when you move in then resist a clause that states you must pay for one when you move out. Otherwise you may find yourself with an enormous cleaning bill for making the property clean for new tenants, even if it was a mess when you moved in. For more information, you can read our helpful advice on end of tenancy cleaning.
These are three of the most common situations in which tenants have found themselves caught out by their tenancy agreement. Other areas to watch out for include the extortionate costs that the agreement may state can be charged when tenants leave furniture behind, failing to carry out an inventory at the start of the tenancy and being charged for damage caused by previous tenants when you leave, as well as not realising the tenancy agreement prevents you from hanging anything directly on the walls.
Challenging clauses in a tenancy agreement
When it comes to a tenancy agreement, renters are often presented with something of a fait accompli. A landlord or letting agent hands the tenant the document and expects it to be signed without argument, despite the fact that, like any commercial agreement that is binding on the parties, its terms are open to negotiation. The reality is that you may well have no choice but to accept some slightly less favourable terms, simply because there could be other tenants who will sign if you don’t. However, if something really feels wrong then you have a right to challenge it, to complain about a letting agent or landlord – or walk away.
Challenging clauses before signing
Essentially, when you start challenging clauses in a tenancy agreement you are opening up a negotiation. Many letting agents in particular will just expect you to sign their pro forma tenancy agreement and ignore the clauses that don’t apply to you. They may have paid a one off fee to a solicitor to have the document drafted and will not want to start amending it at their cost. So, if there are clauses that you are unsure about the best approach is to avoid challenging everything. Don’t sweat the small stuff but instead raise an issue if it is a serious problem for you to comply with. Be reasonable, explain why you need the change, demonstrate how it won’t actually negatively impact the landlord and then enter into a reasonable discussion. The only approach to avoid here is threats and bullying, as before you have signed the agreement, and in the current market where property is in short supply, you may find you simply don’t have the bargaining power to succeed.
Challenging clauses in a signed tenancy agreement
There are a number of ways you can challenge a clause in a signed agreement:
Unfair terms – these are terms that essentially create a significant imbalance in the rights and obligations of the landlord and tenant under the lease, to the tenant’s detriment and contrary to the requirement of good faith. For example a financial penalty, such as an admin fee, or a clause that allows a landlord to take the tenant’s possessions in lieu of unpaid rent (for more information on landlords rights over tenants’ possessions take a look at our helpful blog on the subject). You can challenge an unfair term by complaining to the local Trading Standards Office, where it will be referred to the Unfair Contract Terms Unit at the Office of Fair Trading. If the term is found to be unfair then it won’t be legally binding and enforcement action can be taken to stop a landlord using it.
Statutory rights – statutory rights cannot be overridden by a tenancy agreement, even if it is signed, as they are implied into the contract. Common statutory rights include the right to live peacefully in the property without nuisance from the landlord and the obligation on the landlord to ensure that installations for supply of water, gas, electricity, sanitation and heating are kept in good working order. You can – and should – challenge a clause that tries to exclude any of your statutory rights. If you can find a good letting agent then you can often bypass issues such as this as they should be pretty well informed about what a tenancy agreement should – and should not – contain.
Rent increases – if you have a fixed term Assured Shorthold Tenancy agreement then the rent cannot be increased during the fixed term without your agreement. At least a month’s notice should be given in advance of a rent increase and any increase should be fair and realistic (i.e. along the lines of average local rents) – any rent increase clause that doesn’t comply with these basics can be challenged. A good landlord will be sensible about rent increase, but some do get slightly carried away. If, once you have received a notice about a rent increase, you feel the rent is too high you can take your challenge a Residential Property Tribunal who can change an unfair rent – the right to do this cannot be excluded in the tenancy agreement.