Study reveals one in ten landlords have no formal tenancy agreement

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One in ten private landlords has no formal tenancy agreement in place with their tenants, new research shows.

According to Direct Line for Business, landlords may unwittingly be asking tenants to sign documents that are not legally compliant. Of the landlords who don’t use a letting agent, 58% used adapted tenancy agreements from either old agent contracts or other landlords (38%) or an updated template they found online (20%).

 

It appears landlords employ letting agents when they first rent out the property, then use the old contract template when agreeing a direct rental with new tenants or upon renewal with their existing tenants. The lack of professionally reviewed tenancy agreements may explain why more than one in eight (13%) landlords have experienced disputes specifically arising from tenants’ rental contracts in the last two years.

 

Also concerning is that 9% of landlords have not informed their tenants that their deposit is held in a government-backed tenancy deposit protection scheme (TDP).

 

This is despite the fact it’s a legal requirement that landlords provide the name and contact details of the tenancy deposit protection scheme and its dispute resolution service within 30 days of taking a deposit. The research also revealed that 4% of landlords have not taken any deposit from their tenants.

 

Nick Breton, head of Direct Line for Business, said: “Tenants and landlords need a contract in place to protect both their interests. Contracts, deposits and deposit protection all help to make clear what is expected from each party when renting a property, and which can help minimise disputes where possible.

 

“If an old contract is adapted it may not comply with new legislation or be relevant for the current market. Given the volume of disputes arising from tenancy agreements it’s important to get the contract seen by a legal professional before it’s signed.”

 

When it comes to rights and protection, 38% of landlords in England have never heard of the government’s How to rent: the checklist for renting in England, which explains the rights and responsibilities of landlords and tenants. Less than a third (29%) of landlords have supplied or directed tenants to this guide.

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