Tenancy Agreement

Renting out your apartment may be a good source of passive income but it can give you a host of legal problems if you’re not thorough.

Any conflicts and disagreements between you and your tenant consume time and resources. Especially if the specifics on the tenancy agreement are not detailed before the tenant signs it.

A legal contract will clearly set up the rules and stipulations. It establishes the rights and responsibilities of the landlord and tenant in an official way.

It is the responsibility of all parties involved, including the solicitor and agents to ensure that the tenancy agreement is ironclad and devoid of loopholes.

A tenant agreement is extremely important to the tenant as it protects the tenant from being forcibly evicted should the current landlord sell the property to someone else.

As a guide, we’ve prepared a list of important things you’ll want to look at while drafting out the tenancy agreement;

1. Length and type of tenancy:
A short tenancy typically lasts for six months. A longer tenancy is usually set at a minimum of a year with an option to renew. You must also determine how many people are allowed to live in the apartment/property and how long a notice your tenant will need to give if they want to terminate it prematurely.

2. Dos & don’ts:
Are there any restrictions you’re going to impose on your tenants? Will they be disallowed to own any pets or only a certain type? What about loud music and house parties? Will they be allowed to entertain guests and have them stay over temporarily?

3. Rent:
How much rent you can charge depends on the location of your property, the distance to amenities, the condition of the property and what features are included. You need to also determine when the tenant must pay the monthly rent and what penalties there are for missing payment. State all additional and hidden costs and let your tenant know what is covered in the rent and what aren’t. Also state what factors may influence you to increase the rent.

4. Deposits:
How much of a deposit does your tenant need to pay? One month or two? When will you return the deposit and under what conditions will it be withheld?

5. Maintenance:
Will you provide any maintenance services? How frequent will you check on the property? What type of maintenance will you provide? Will you charge for these additional services? Do you provide other services such as maids, laundry and weekly vacuuming?

6. Landlord’s rights:
How frequently will you visit the property? Will you schedule an appointment? Do you have access to the property when the tenant is not around? How can the tenant be sure that the landlord will not enter the property uninvited? Under what circumstances can the landlord enter the property without informing and scheduling a visit with the current tenant?

Following these guidelines while having your lawyer preside over the contract will go a long way to ensuring that you and your tenant’s rights will be legally and fairly represented at all times.