Put the lodger's tenancy on a formal footing and get the room back or have a lodger leave when you need with this lodger agreement. This excluded tenancy agreement deals with all the key issues of a lodger's tenancy and complies with the tenant fees ban. As long as you get the details right, this lodger agreement can be a tax efficient way to raise some extra cash and give yourself a bit of company.
Overview of the Lodger agreement
When should I use a lodger agreement?
Use this lodger agreement:
- when you are looking to rent out a room at your property
- when you will be living at the property
- when the property is your main home
- only when the property is in England or Wales
What's included in a lodger agreement?
This lodger agreement covers:
- the amount of rent payable
- the level of deposit (if any) required
- the right for the lodger to use the common areas in the property
- the landlord's responsibilities
- what the lodger can and cannot do at the property
- ending the agreement
- the requirements under the Tenant Fees Act 2019
What's a lodger agreement?
A lodger agreement is a residential tenancy agreement that sets out the terms that a lodger can occupy the property.
Do I need a lodger agreement?
This lodger agreement can be used by an owner or tenant living in a furnished house or flat in England or Wales who are renting out a room to a lodger. If you have a lease of the property you must check the terms of your own tenancy agreement to ensure that you are permitted to take in lodgers before completing this lodger agreement.
How many lodgers can live with the owner?
There can be no more than two lodgers (who are unrelated) living with you at the property. If there are more than two the property may be classed as a house in multiple occupation (HMO). In these circumstances you must comply with additional regulations and may need to apply for a licence and there are large fines for non-compliance.
What is the length of the lodger agreement?
The agreement can run for any length that you agree with the lodger. The term is usually fixed for a period between six and twelve months and then renewed.
At the end of the term, the lodger must leave the property with their items and leave the property in good condition.
Should I take a deposit from the lodger?
As a lodger usually only occupies for a short period of time, a deposit is not always required. However, a deposit of a month's rent can be taken to cover the cost of any breakages or damage to the property or its contents. The money is returned to the lodger if there is no damage or rent due when the lodger leaves. There is no requirement to protect the deposit under a tenancy deposit protection scheme but it is good practice to place it in a separate account.
What restrictions are placed on the lodger?
The agreement includes a list of what the lodger can and cannot do at the property. This includes not causing a nuisance, not keeping pets and not allowing any other person to occupy the room.
The lodger is not granted exclusive possession of the room at the property and you keep the right to enter the room at reasonable times to check its condition.
Is there a notice period for early termination?
The lodger agreement includes an optional clause to allow either party to terminate the agreement on notice to the other. The amount of notice that needs to be given to the other can be in either weeks or months. You can decide what length of notice is needed but it is advisable to keep the notice period as short as possible (eg one week) so you can end the agreement quickly if problems occur.
Do lodgers have protection from eviction?
Lodgers do not have the same protection from eviction that tenants have and if a lodger does not move out (after being given notice to leave in accordance with the terms of the lodger agreement) they are trespassing. You can end the agreement without having to apply to the court for an order for possession if things go wrong.
What is the amount of rent payable by the lodger?
The rent can be set at any level and can be payable monthly or weekly. Generally the level of rent will be the market rent similar to other lodgings and tenancies in the local area. If at any time during the term of the agreement two or more rent payments are due or unpaid, the agreement will terminate automatically.
It is assumed that the rent does not include outgoings and the lodger will be responsible for a proportion of the costs of other outgoings at the property (eg gas, electricity and water rates). A separate contribution can be agreed directly with the lodger.
The rent should include any council tax, as it is the landlord's obligation to pay council tax for the property under this agreement.
Are services being given to the lodger?
A lodger can or may be provided with services in addition to the use of the room and the common areas. Such services might include cleaning the room or providing meals.
Should you include an inventory?
An inventory is a detailed list of all of the contents at the property and their condition. It is usual to provide a detailed inventory of the items in the lodger's room, plus any items in the property that the lodger can use. The lodger will only have full responsibility for the items in the room and the items listed on the inventory must be left in the same state of repair and condition when the lodger vacates. If not, any deposit held can be deducted to cover the cost of repairs.
Does this document cover the new ban to tenant fees?
Yes. This document has been amended to be compliant with the Tenant Fees Act 2019. It excludes fees prohibited under the Act, while it also allows for certain damages to be recoverable.
Further advice
Ask a lawyer for:
- lodgers who want to run a business from the property
- student or college accommodation
- lodgers who want to live at the property on a part-time basis
- advice if there are 3 or more prospective lodgers that form more than 1 household, as the property may need to be licensed
- a property that is outside England and Wales