Tenancy Agreements Explained: What You Need to Know | Ep. 26

Most tenants sign a tenancy agreement without really reading it. And most landlords rely on clauses they've never actually checked are enforceable. In this episode of All Things Property, Simon Bacon and Ian Sadler walk through the key clauses that matter, the ones that cause problems and the ones that protect both sides.

What You'll Learn:

- What a tenancy agreement actually is and why it matters
- The key clauses landlords rely on (and should check)
- What tenants need to pay attention to before signing
- Rules around commercial vehicles, caravans and parking
- How to set expectations with tenants from day one
- The pet question: questionnaires, the Renters Rights Act and what's reasonable
- Smoking policies and how to handle them honestly
- Why subletting is a firm no

Key Topics Covered:
The Basics - A tenancy agreement is a legally binding document that sets out the relationship between tenant and landlord. The first page covers the essentials: start date, term, rent, deposit. The rest covers how the tenant is expected to live in the property.

Commercial Vehicles and Parking - Can tenants park works vans or caravans on the driveway? It depends on the lease or TP1 of the property. Enforcement usually starts with a neighbour complaint rather than an agent inspection.

Pets and the Renters Rights Act - Landlords can no longer unreasonably refuse a pet, but interpretation is everything. Simon advocates for a pet questionnaire to gather the right information and support both the tenant's application and the landlord's decision. Getting it in the tenancy agreement with specific clauses is key.

Smoking - Cynicism aside, most tenants who say they'll smoke outside actually do. But the clause needs to be clear and both parties need to understand the consequences.
Setting Expectations Early - Communication starts at the first viewing. Telling prospective tenants what the landlord expects and whether the property suits their lifestyle prevents problems down the line.

The Takeaway:
A tenancy agreement needs to be clear, practical and understood by both parties. If you don't understand it, you can't rely on it.

Chapters
0:00 - Introduction
0:35 - What Is a Tenancy Agreement?
1:18 - Key Clauses for Landlords
1:42 - Clauses Tenants Should Pay Attention To
2:12 - The "Immoral Purposes" Clause
2:20 - Commercial Vans on Driveways
3:06 - Caravans and Trailers
3:41 - When Neighbours Complain
4:40 - Do Tenants Ever Ask About Parking Vans?
5:00 - What Are Landlords Really Looking For?
6:24 - Setting Expectations at Viewings
7:33 - People Who Misrepresent Themselves
8:28 - Pets, Smoking and Subletting
8:50 - The Pet Question
9:29 - How the Renters Rights Act Changes Things
10:52 - When You Discover an Undisclosed Pet
11:20 - Why a Pet Questionnaire Matters
12:34 - Drafting the Right Clauses
13:07 - Responsible Pet Ownership
14:00 - Would a Large Dog in a Small House Be Reasonable to Refuse?
14:55 - How Case Law Will Shape This
15:35 - Link to the Pet Questionnaire
16:57 - Supporting Both Landlords and Tenants
17:29 - What If a Pet Owner Doesn't Get the Property?
19:35 - The Smoking Question
20:49 - The Takeaway: Clear, Practical Agreements
21:43 - Outro

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www.prefprop.com

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Transcript

SPEAKER_01 0:00

Welcome to the All Things Property Podcast with me, Simon Bacon, and me is Adler. So today in what I thought we'd talk about a very um exciting subject because I know that really gets your juices flowing. We're going to talk about tenancy agreements. Yes, I know. I could sense it the moment I said it that you were thinking, yeah, I've got a lot to say about this. So Welcome to the All Things Property Podcast with me, Simon Bacon of Preferential Properties. Every week, Ian Saddler and I will delve into All Things Property. We'll guide you through with friendly, no nonsense advice. The reality is most people probably sign a tenancy agreement without really reading it, and probably most landlords rely on clauses that they've never actually checked are enforceable. So let's just give our viewers a sense of what is a tenancy agreement, why is it needed?

SPEAKER_00 0:58

It's a legally binding document between the tenant and the landlord that specifically details the relationship. I'm sorry. I told you to set a bit so it would be boring. Go on, carry on. It details the relationship between the tenant and the landlord, the do's and the don'ts of both parties. And over to you for more.

SPEAKER_01 1:18

No, excellent. Okay. So what do you what are the key kind of clauses that um that landlords would would rely on?

SPEAKER_00 1:26

Well, the first page of any agreement really, the date tenancy starts, the term of it, the rent payment date, the rent due date, the deposit held, those things. The rest are Yeah.

SPEAKER_01 1:38

Things like notices, yeah, rent and review notices, that sort of thing. Okay. What are the clauses that uh tenants should probably pay attention to?

SPEAKER_00 1:50

How they're expected to to live in the property, really. Um care and maintenance of the property, pets, reporting repairs.

SPEAKER_01 2:00

Repairs, yeah. What they're allowed to do, who they're allowed to have at the property. You know, some of those some of those clauses can often be, you know, things that people don't think about in terms of, I don't know.

SPEAKER_00 2:12

Yeah, my favourite clause is not to use the property for any immoral purposes. What does that mean?

SPEAKER_01 2:18

Well, maybe you leave you to think about that one. Okay, alright. Um what about commercial vans on driveways?

SPEAKER_00 2:26

Uh it depends on the uh the TP one or the lease of the property, which can stipulate whether you're allowed to have that or not. Difficult one to enforce again, isn't it? Um would you expect landlord the a or the agent to check that the there is no commercial vehicle parked going to be parked on the driveway?

SPEAKER_01 2:48

Do you ever say to people when you shoot around if they that you can't put a works van on the on the driveway? No? What about caravans? Have you ever had caravans?

SPEAKER_00 2:59

I've never never had a tenant with a caravan parked on the site, no. Okay. No. I live a very sheltered life up there. Yeah. What about uh trailers? Um not constant parking of trailers, no use for garden works or move venture around, maybe, but I think it's gonna that sort of situation is gonna be instigated by a an annoyed neighbour who's all of a sudden got a six-birth caravan park next door to him. Yeah. And that's a that's can only be solved by terms of uh the landlord's obligations.

SPEAKER_01 3:41

So it is it is really important that you know both tenants and landlords understand what the clauses are and what is you know what's enforceable, what you can go to a tenant. So, you know, if if a neighbour complains that you know somebody per parks their, I don't know, their works van blocking the the drive or blocking the pavement, is that a valid cause for complaint?

SPEAKER_00 4:08

Yeah, I think so. I think it it's once again it's it's degrees of disturbance, isn't it? If somebody parks a works van on the driveway, on their driveway, on their property, during their tenancy, and it's not blocking anything, then nine times out of ten it would be you'd let it go, or nobody would complain. If it's annoying the neighbour or blocking the neighbour's driveway, that's a completely different thing.

SPEAKER_01 4:34

And then you start the a course of action which would so when you do a viewing, how many times do potential tenants say, is it all right for me to park my works value? I've never had I've never had that question, I've never. Do you think they should?

SPEAKER_00 4:51

No, I think natural instinct would be not to ask that question. Why would you ask a question where the agency would say no, you can't do that, and raise a red flag?

SPEAKER_01 5:00

You see, that's that's for me that's a really interesting question. So when I do viewings, I do often get asked, how's a landlord? You know, what are you looking for? What's a landlord looking for from a tenant? How how would you answer that? So you get asked that question a lot, do you? Yeah, I do.

SPEAKER_00 5:21

I can't have ever been asked that question. Haven't you? No.

SPEAKER_01 5:24

So I have a standard answer for it.

SPEAKER_00 5:26

Well, treat it like it's your own home.

SPEAKER_01 5:28

Yeah, yeah, absolutely. I always my stock answer is, you know, if if I get asked what what's you know, how's a landlord going to decide what's a landlord looking for from a tenant? What I always say to people is, you know, it's really simple. What we're looking for is, you know, somebody who's going to pay their rent on time, look after the property, report any repairs and maintenance promptly, and you know, allow us to come and do our regular inspections, um, given giving notice and treat the property with with respect. They are the the key criteria that I always I always say. And actually, when you think about it, most of the clauses within a tenancy agreement uh cover that off uh in in its entirety, doesn't it? So you know it's it's a difficult one in terms of that's what a landlord wants. Sometimes I will say to people, I don't know whether this will be ageist, I do say to people if you are no if you are someone that you know has lots of parties, likes to be up late, have loads of friends around, you know, outside parties, I do try and say to them that actually you need to be aware that for example, if if they're moving into a terraced house and the people next door, you know, have got a young baby, that's the kind of information that sometimes I say to people, look, you know, just be aware of that. If that's you, then the chances are this property may not be suitable for you. I try and be as open and honest with people, because all although the tenancy agreements will stipulate that, you know, lots of tenancy agreements will say no loud music after what eleven o'clock, know this, know that. So it is making sure that tenants really do understand what their responsibilities are. Don't you agree?

SPEAKER_00 7:33

Yeah, but in in everybody, they of course they should understand their responsibilities. But people have been known to misrepresent their moral standards at the beginning. And how people live, you can't legislate for. Somebody can appear to be perfectly reasonable human being, but be an absolute arse when it comes to being a tenant.

SPEAKER_01 7:54

Yeah, absolutely. Which is why I do try and set out the grounds and say to them, look, if if that's you, then this property probably isn't going to be the right one for you because you know there are we will be on it, we will, and it's that communication. Communication starts the moment you first meet a prospective tenant and go, look, this is what we're looking for. This is you know, is this the right property for you? Not just, you know, are you going to get it? It's is this the right property for you? Which leads me on to pets smoking and subletting. What do you think about that?

SPEAKER_00 8:31

I think it's highly regular for pets to smoke, and I think that if they decide to sublet, then that's um a real no-no.

SPEAKER_01 8:38

Really? Okay. Smoking pets. Yeah. Okay. Luckily, Ted doesn't smoke, so I'm I'm alright with that one. Let's perhaps break it down into single parts pets.

SPEAKER_00 8:50

No problem. More about the people than the pet for me. Okay, and what are you going to be doing about the um pets and uh renters' rights act?

SPEAKER_01 9:00

Are you going to do anything particular about that or not?

SPEAKER_00 9:02

No, just kind of do what I'm doing. If somebody's got um a pet and they seem like reasonable people.

SPEAKER_01 9:10

But have you met do you meet the pet at the uh viewing?

SPEAKER_00 9:12

No. Why not? Because to be honest, which is what we're supposed to be on this, it's if you are a tenant in this market where you you've got ten tenants looking for one property, yeah, then are you really going to take your dog with you on a viewing? Do you not?

SPEAKER_01 9:29

Well, so isn't that going to change with uh the implementation of the project?

SPEAKER_00 9:33

Only if challenged, only if challenged by a tenant. Why? Because they have a right now to have a tenant. Absolutely.

SPEAKER_01 9:40

In the past, in the past, you know, let's let's be honest, tenants have been wise and thought, okay, I know that if I you know perhaps I'm generalizing, but I think there are tenants out there who have gone, I'm not going to disclose I've got a pet. So, you know, when I get when they when they ask me, I'll say no, and then you know, I'll put in a request, and you you you've had this, I know you've had this because I've had it, where um you get a phone call to say um my mum or my relative or someone is going away for a while and they've asked me to look after their pet for a couple of weeks. Is that all right?

SPEAKER_00 10:23

Yes, I have had that, and you don't you well how you can say you can't say no, can you?

SPEAKER_01 10:28

No, no, absolutely. Or you go and do an inspection and you know you you ruck up at the front door and you knock the door and it's woof woof woof woof, yes, exactly. And you're thinking, Oh, I didn't know we had a we had a dog in this one, and then do you go, you know, so tenant comes to the door looking possibly occasionally a little sheepish, but with with the excuse of I'm just looking after it for a couple of days.

SPEAKER_00 10:51

Now at the end of the day, it's it's how the dog lives in the property, isn't it? Yeah. How how he acts in the property. I think if that happens, then the first thing I would do is get a petadendum in place signed by both parties, stipulating quite clearly the obligations of the tenant in the event of damage or carpet cleaning or any sort of cleaning. So I this is I I wouldn't preempt an issue until it actually became one.

SPEAKER_01 11:20

Yeah, perhaps that's where you and I are slightly different, because I've got lots of landlords who are anxious about this pet issue around tenancy agreements, what it can say, what it can't say. Now, my understanding of the of the act is that you you in order for a tenant to have a pet, you have to approve it unless there are legitimate reasons for not approving it. So to protect a landlord, surely have you not thought about doing a a pet questionnaire? It's about honesty and communication. So one of the things we're introducing is a pet questionnaire. So that if somebody says, I have a pet, that's fine, fill out the form. What kind of because you want to know what what it is? Male, female, dog, cat, how many? Is that pet being looked after? Does it have a history of fleas? Does it go to the vet? Does it begin with population?

SPEAKER_00 12:24

How can a pet fill in a questionnaire to begin with? Okay. Now you've got to be. Secondly, you're being silly. Silly. Not funny. The biggest mistake that potential biggest mistake that lefting agents are going to make is they're using their interpretation of the Renters' Rights Act rather than specific clauses in their tenants agreement. This is all about how your agreement is drafted. And you put your interpretation of the Renters Rights Act into your tenants agreement with specific clauses, then it's in black and white, both parties sign it, that's done.

SPEAKER_01 12:58

But you can't argue that point afterwards. It's too late at that point, isn't it? Surely, if you're going to allow a pet, bear in mind we often have Ted here, so you know, this isn't about somebody who doesn't want pets. This is about trying to make sure that we have responsible pet owners. So for me, it's about ask a tenant, uh ask an applicant to fill out a pet questionnaire. If a tenant comes to you and says, Look, I know that the rent is like I'm now allowed to ask for a pet, and landlord can't reasonably refuse.

SPEAKER_00 13:31

It's an interpretation. I know I'm allowed to ask for a pet, which means you can potentially have one, and the landlord cannot unreasonably refuse me permission to have that. Yeah. It's interpretation again, isn't it?

SPEAKER_01 13:42

Yeah. So if you've got the in but surely you want the information, don't you? You want to be able to hang your thing.

SPEAKER_00 13:49

If somebody says, I have a pet, I I it's a dog, cat, whatever, I always ask them what breed it is.

SPEAKER_01 13:56

Yeah. Um so let me ask you a question then. Okay. Would it be reasonable? So Ted often sits here with us, okay? Not the smallest dog in the world. If if somebody came to you with a Leon burger and was moving into a two-bed small terraced house, would that be suitable? Do you think Ted would be suitable? Would the landlord have grounds to go, not sure on that one?

SPEAKER_00 14:27

Yeah, he would probably. And the tenant would say, No, it'd be fine. And landlord said, I don't think so. Yeah. Where do you meet? You have to make a decision. You do, but it's easy to make that decision now.

SPEAKER_01 14:38

Yes, but don't forget what we've always talked about, which is you know, tribunals and being able to contest stuff. So PEPT is one that it would be inter I don't know how it will work, but it would be interesting to see how many um pet requests do get contested. Well, case case law will be interesting, absolutely. But I would say, in order to protect everybody, isn't a pet questionnaire worthwhile having? So you can say, well, actually, you asked for a pet, you asked to have a dog. When I came to do my inspection, we ended up with I I noticed there were three dogs. But on your pet questionnaire, you only we only gave authority for for one pet.

SPEAKER_00 15:21

How do you see that panning out? What do you mean? Breaching the tenancy agreement. Three dogs. Yeah. You've got the addendum in place retrospectively, covering damage and so on. Yeah.

SPEAKER_01 15:33

Well, my pet questionnaire, I know I'm going on a banging on about this, aren't I? And by the way, if anybody wants to see sight of the pet questionnaire, then there will be a link to that following the podcast. But yes, the pet questionnaire for me is one way of trying to make sure that we really do embrace the impact of the the act by saying, yep, fine, but one of the things is you have to be a responsible pet owner. So here you are, you know, tenant. Can you please let us have all the information we need to go to your landlord to support your application? It's not to say, oh, we don't want you to, it's to support your application to say, look, here, Mr. Landlord, you know, or Mrs. Landlord, here here is we've your tenants asked for a pet. It's this dog or it's this breed, it's you know, it's got all its inoculations up to date, it is um registered with a local vet that you know it has its flea treatment, and on by the way, and there will be an addendum that says this, this, this, and this at the end of the tenancy, the tenant is responsible for uh for these issues. Isn't isn't that you know a tick in a box of embracing it, assisting a tenant, and supporting your landlord as well?

SPEAKER_00 16:57

I want to use a phrase I'm not going to but that's is that not a form of a security blanket stroke security for you as an agent?

SPEAKER_01 17:07

Potentially, but it will be. Potential breaches of or challenges too. No, no, it's not a breach of anything. It's I would have said that's showing us in good light supporting the tenant and supporting the tenant because we've got all the information available to us to help the land or to come to the that decision. And it's supporting the tenants.

SPEAKER_00 17:28

Okay, so devil's advocate again. You've got a nice two-bedroom property, six rings organized, one of the tenants has two young dogs, and other five tenants have no dogs at all. Landlord naturally, probably is going to choose if four people apply for it, he's going to choose the one that hasn't got the pets, isn't he? So, what rights or grounds then would the tenant that didn't get the property have? What would the process be? How can they justify he wouldn't let me have a pet? Well, you weren't even selected.

SPEAKER_01 18:09

Who knows the answer to that one here? Well, in this market, but it's it's about communication. Now, my worry is that there will be again people will come up to viewings or come along to viewing, not disclose something, move in, and then say, and what I want to try and do is say, well, no, let's be, let's have that good communication to start with, because come to me and say I've got I've got a dog, and show if you show me that you're responsible is they're two small dogs and they go to the vets, and they're you know, they've got all their um inoculations, etc., then and and like you said, you've shown them round and you're saying to landlord, actually, yes, you know, we've got this person, haven't got a pet, this person has got a pet, but we know who it is, we know there is you know they appear to be a responsible dog owner, and they've got all cat owner, and they've got this and they've got that. Then, you know, aren't we going to be saying to them under the you know, with the new legislation, you you can't describe we've we've put all in place all these mechanisms. I'd rather people are really honest at the front, and then we can support them to have that. You know, being a dog owner myself, I know how difficult it is for people to get rented properties with dogs, but so there is a part of let's try and support and let's try and make sure that you know we do everything we can to help both the landlords and and the tenants.

SPEAKER_00 19:35

And without wanting to labour the point, I would say in this market where you've got more tenants than you've got properties, it would be relatively easy for a landlord or the agent to choose the tenant after. For applications has not got a dog or a pet. It's a natural thing to do, isn't it? Or smoking, whatever. So, what would the process do you think would be then the the tenant who didn't get it, what would they have any grounds? What could they do to complain about not getting the property?

SPEAKER_01 20:01

I don't think they would have any grounds. It's a bit like smoke, you know, it's like smoking, you know. If you see someone smoking when they walk, you know, before they if you smell smoke on someone when that you show someone around design, do you go from not having them? Or do you say to them, look, you know, you do realize it's a non-smoking property, you can smoke outside, it's fine.

SPEAKER_00 20:26

The the problem is you and I are so long in the tooth in this business, we tend to be a little bit cynical when it comes to a potential tenant saying, Oh, I smoke, but I I'll only smoke outside. It's not gonna happen, is it? Well nine times out of ten again.

SPEAKER_01 20:41

I I think most times it does. I used to be a smoker and I used to smoke outside. So I think and I I think it's possible. But coming back, bringing coming back to the original part of this podcast, what we were saying was the importance of tenancy agreements that have all of these issues set out so that everybody knows very clearly what their responsibilities and their roles are, what is permitted and what's not permitted. And yes, you know, in what we have done is is possibly picked up on a couple of those issues that are probably some of the more contentious ones, but there will be lots of clauses and subclauses in tenancy agreements that you know I would absolutely encourage tenants and landlords to read. And the takeaway from this this particular podcast, I think, is a tenancy agreement needs to be clear and practical, and if you don't understand it, you can't rely on it. Thank you very much. Thanks for tuning in to this week's episode of the All Things Property Podcast. If you found this episode useful, don't forget to subscribe, like and share. These things really help us reach the people who need to hear. this advice. See you next week.