A clause skipped in the contract comes back a year later as a problem.
What each part of a tenancy contract is for, and what happens when one is missing. We take the headings the office meets most often, in order.
Dates: start, end and the first payment
Dates are where a contract gets muddled most. The start date is the day the rent begins to run, the end date the day the term expires. There is also the day of the first payment, and it can differ from both.
If the tenant moves in on the fifteenth, is the first month calculated pro rata or charged in full? Leave it out of the contract and you will argue about it at the first collection.
- The start and end dates are written separately
- The first payment day is stated as well
- Which day of each month it is collected on must be clear
- What happens when the term expires (renewal, notice of termination) is written down
Increase: type and timing
If the contract does not state how the increase will be made, the parties come to the table with different expectations when the anniversary arrives.
Writing the type of increase is not enough; when it will be applied has to be written too. On the anniversary, or at the start of the calendar year? The two give different results.
- Type of increase: index-based, a fixed rate or another method
- The date the increase will be applied
- For residential rents the statutory upper limit is taken into account
- For business premises the parties may agree a different method
Deposit: amount, return and conditions
A deposit is easy to take and hard to give back. If when, under what conditions and within what period it will be returned is not written down, there will be a dispute at the end.
If deductions may be made from the deposit, what may be deducted must not be left vague either: missing fixtures, unpaid bills, or damage?
- The deposit amount and its currency
- The conditions and period for its return
- In what circumstances a deduction may be made
- Where the deposit will be held
Guarantor: who, and with what details
When a guarantor is added, often only the name is written down. When a problem arises you have to reach that person, and if all you have is a name the job gets hard.
The guarantor's identity details, phone number and address should all be in the contract. If there is more than one guarantor, each is written separately.
- Full name, ID number, phone and address
- More than one guarantor is recorded separately
- The scope and duration of the guarantee
Fixtures: what was there at handover
This is the most argued-about subject at the end of a tenancy. Was the boiler working, how many air conditioners were there, was the built-in kitchen complete?
Listing the fixtures one by one at handover takes ten minutes; not listing them takes days at the end. Photograph them if you can and attach it to the contract.
- Each fixture is listed with its quantity and condition
- Anything faulty is written down as well
- The handover record is attached to the contract
Other clauses
Who pays the stamp duty, which account the rent is paid into, whose responsibility the service charge is: clauses like these look small, but each one is remembered once it has caused a problem.
- Liability for stamp duty, the tax levied on the document
- The IBAN the payment will be made to
- Who the service charge and shared costs belong to
- The address for formal notices and the contact person
Frequently asked
- Does a tenancy contract have to be made before a notary?
- A tenancy contract can also be made in writing between the parties. Notarisation is not compulsory, but it makes the contract easier to prove. Consult your lawyer about your own situation.
- What happens if something comes up that the contract does not cover?
- On matters the contract does not regulate, the provisions of the law apply. That is why, where the parties' expectations differ, that expectation has to be written into the contract.
- What is the maximum a deposit can be?
- For residential rents there is a statutory upper limit for the deposit. We recommend consulting your lawyer for the current limit and how it is applied.
- Can a contract be made without a guarantor?
- Yes, a guarantor is not compulsory. Whether to ask for one is up to the parties; when one is asked for, it matters that their details are taken in full.
- Is a list of fixtures essential?
- It is not compulsory, but most of the disputes that arise at the end of a tenancy come from here. Keeping a list at handover prevents the argument later.
This guide is a checklist drawn from office practice and is not legal advice. Consult your lawyer about the wording of the contract and the validity of its clauses; the legislation in force governs.
So you do not write these clauses out on every contract
In Bi'Emlak the tenancy contract form is split into eight parts: dates, payment, VAT, commission, deposit, guarantors and other clauses are each asked for separately. You do not go looking for where a piece of information belongs.
See tenancy contract tracking