This is the final blog in the four part series on understanding your tenancy agreement!
When it comes to a tenancy agreement, renters are often presented with something of a fait accompli. Some landlords and letting agents hand the tenant the document and expect 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 agreement, 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).
If needs be, 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.