What tenants should know about tenancy agreements and deposits
Estimated reading time: 4 minutes.
Rhys Owen, Senior Property Advisor, goes through some of the most common types of tenancy agreement contracts and the importance of understanding tenancy deposits...
Many tenants find the rental process fairly challenging. Initially, it seems like all a tenant needs to do is put together a deposit, find a property they like and can afford, sign a few pieces of paper, and then collect the keys on moving-in day. However, both tenants and landlords have many obligations and responsibilities that they must follow before, during, and at the end of a tenancy.
Before a tenant boxes up their belongings ready for a fresh start in a new home, they should pay very close attention to the tenancy agreement. This legally binding document clearly outlines everything that both a tenant and landlord must be aware of, from the rental price that must be paid during a certain period of time, what bills may or may not be covered in the rent, maintenance responsibilities that a tenant should carry out, and many more terms and conditions of the tenancy.
The tenancy agreement will also clarify exactly what type of tenancy is being agreed. It could be a fixed-term (Assured Shorthold Tenancy), which is when a tenancy agreement runs for a set period of time - typically 6 or 12 months - or a periodic tenancy, which will run weekly or monthly.
When a fixed-term comes to an end, many tenancy agreements will automatically switch to a periodic tenancy agreement unless a new fixed-term tenancy agreement is signed.
Below, we’ll discuss what you should know about some of the most common tenancy agreements and deposit requirements.
The different types of tenancy contracts
There are three main types of agreements that are commonly used. These are Assured Shorthold Tenancy (AST), Assured Tenancy and Joint Tenancy.
What is an Assured Shorthold Tenancy?
The most commonly used tenancy agreement contract is an Assured Shorthold Tenancy, often abbreviated as AST. These tenancy contracts are used by private landlords who are not living in the same property with the tenants. AST’s are fixed term contracts which tend to run for either 6 or 12 months at a time. At the end of the fixed term, a new AST agreement can be signed unless the tenant wants to move out or the landlord wants to regain control of the property.
What is an Assured Tenancy?
An Assured Tenancy agreement offers the tenancy a lot more security as it allows the tenants to remain living in the property with no set end date looming. This type of lease can also be passed on to another tenant in some situations, and because this type of agreement can run for many years, the landlord has the right to increase the rent in the future.
What is a Joint Tenancy?
A Joint Tenancy is most suitable for tenants who are renting together with one single signed agreement, which means each are fully responsible for rent payments. It’s important to recognise with a joint tenancy agreement, should one tenant move out, any remaining tenants will still be fully responsible for everything outlined in the agreement, including outstanding rental payments.
Other less common tenancy agreement contracts include an excluded tenancy (for lodgers), a non-assured tenancy, a regulated tenancy, and a company let.
Read: Extra things a tenant should look out for in a tenancy agreement
The tenancy deposit
One thing that all seasoned renters will understand the importance of is tenancy deposits. The tenancy agreement will set out how much the deposit is and how it will be protected. It will also likely outline which situations may result in the deposit being fully or partially withheld, such as to pay for any damage repairs that need to be rectified that were caused during the duration of the tenancy. Tenants are able to raise a free dispute if they disagree with any withheld deposit by the landlord, and the deposit scheme will then work to reach a fair conclusion.
Landlords in Wales are legally required to secure tenant’s deposits in one of three government-backed deposit protection schemes. These schemes include the Deposit Protection Service, My Deposits, and the Tenancy Deposit Scheme.
If you have reason to believe that your landlord hasn’t carried out this legal obligation, you should seek legal advice as you may be able request the full return of your deposit no matter what or seek compensation in court.
Read: Our Renting FAQs
Are you a tenant in Cardiff looking to learn more about the rental process, or in search of the perfect rental property somewhere in the city? If so, contact our knowledgeable lettings team here at CPS Homes as we’re perfectly positioned to help with several branches across Cardiff and over 20 years local industry experience. Get in touch by calling 02920 668585, e-mailing enquiries@cpshomes.co.uk or by popping in branch to speak with us.
The information contained within this article was correct at the date of publishing and is not guaranteed to remain correct in the present day.
