Key Documents Landlords Need And What You Should Be Aware Of

When you are renting out your property it is essential that you are familiar with the correct laws and regulations. Being a landlord can sometimes be stressful and therefore it is important that you choose the right tenants to try and avoid any issues arising.

This blog outlines key documents you should make as a landlord and will also cover what you should be aware of when renting your property.

How do I choose the right tenant?

It’s a good idea to implement some kind of vetting procedure when you or your letting agent are searching for the right tenants. A number of things can be taken into consideration when choosing tenants, such as whether they have a good credit history as this will give you an indication of whether they will meet their rent obligations. Additionally, you can ask for a reference from their previous landlord and check if they have ever been previously evicted.

Remember that it is illegal to discriminate against tenants on the basis of race, gender, sexuality, disability, age or religion or belief. For more information read our guide on choosing the right tenant.

What are the legal requirements of renting out to multiple tenants?

Houses in Multiple Occupation (HMOs) are when individuals from different households live together and share a common area e.g. kitchen or bathroom. A property is a HMO if:

• there are at least 3 tenants in the property from different households
• tenants share a kitchen and a bathroom

A property is considered a large HMO if at least 5 tenants live at the property from different households and tenants share a kitchen or bathroom.

When your HMO is occupied by 5 tenants or more you must have a licence.

In England, some councils also require other HMOs to be licensed, even if the property is smaller or rented to fewer people. This is known as selective licensing.

If you are a landlord and want to know whether your HMO needs a licence, you should check with your Local Authority for their policies on HMOs, as there are large fines for non-compliance.

Which documents do I need as a landlord?

Tenancy agreement

A tenancy agreement sets out the rights and responsibilities of both the landlord and tenant, including:

• term of tenancy
• responsibilities of both parties
• monthly rent payments
• security deposit amount and conditions
• optional break clause
• how to end the tenancy
• the requirements under the Homes (Fitness for Human Habitation) Act 2018 and the Tenant Fees Act 2019

There are a few different types of rental agreements you can choose from and it’s important you select the right one for your property. For example, you’ll want a tenancy agreement for a flat when renting out a flat in its entirety and a tenancy agreement for a house when renting out a house in its entirety. Both of these agreements give tenants the exclusive right to use and occupy the property for a fixed term.

If you want to rent out separate rooms to multiple individual tenants in a property that you own but do not live in, create a room rental agreement. If you are living in your property and want to rent out a spare room, a lodger agreement can be used. This article explains both these types of agreement in further detail below.

Make your tenancy agreement.

Room rental agreement

You should use a room rental agreement when you do not live at the property and want to rent out rooms in your property to individual tenants or want to enter into separate tenancy agreements for each room. With this agreement the tenant will have exclusive use of their room and share other facilities such as the kitchen, living room or toilet facilities.

With this type of agreement you can rent out your property for a short period of time at full market rent and this makes it easier to evict tenants that cause you trouble or do not pay rent on time.

Make your room rental agreement.

Lodger agreement

Lodger agreements differ from standard tenancy agreements because they are used when you live in the property where you want to rent out rooms. This is a tax efficient way of making the most of spare rooms in your property. Lodger agreements usually include:

• whether a deposit is payable
• amount of rent
• landlord and lodger responsibilities
• terms of the lodger’s use of common areas
• how to end the agreement
• requirements under the Tenant Fees Act 2019

Make your lodger agreement.

Energy Performance Certificate (EPC)

An EPC contains details about a property’s energy efficiency rating, energy costs, energy use and how energy use can be reduced. Energy efficiency ratings are categorised from A (most efficient) to G (least efficient). Currently, all rental properties are required to have an EPC rating of E or above. However, you should be aware that from 2025 new regulations are coming into force that will require rental properties to have an efficiency rating of C or above. Both residential and commercial properties are legally required to have an EPC. Some situations exist in where an EPC is not required, these include (applicable to England and Wales):

• an officially protected building that is a Listed building on the Historic England (or Welsh equivalent)
• a building used for religious reasons or as a place of worship
• industrial sites, workshops or non-residential agricultural buildings
• a temporary building with a use of two years or less
• standalone buildings, other than dwellings, with a useful floor area of less than 50 meters squared

You do not need a new EPC every time you have a new tenant as they are valid for 10 years from the date of issue. Use the government EPC register to find an assessor and get your certificate. It is important you have an EPC if you are legally required to because you could be subject to penalties and may not be able to evict a tenant when you wish to.

For more information read our guide on EPCs.

Inventory

An inventory is a detailed list outlining the condition of items in the property and how the tenant can use them. This helps to prevent disputes between landlords and tenants and ensures correct records are kept so tenants are aware that their security deposit might be used to pay for any damages caused by them during their tenancy.

Make your inventory, which can be used for both furnished and unfurnished properties.

Eviction notices

There are a number of reasons as to why you might want to evict tenants or vacate your property, including wanting to live in the property yourself or because of disputes with tenants. It is important that in these situations you evict your tenants safely and legally. There are two ways of evicting tenants:

1. Section 21 Notice – this type of notice is a ‘no fault’ notice and is usually served on tenants when the tenancy agreement is coming to an end. You should use this notice when you wish to regain possession of your property.
2. Section 8 Notice – this type of notice is usually used to evict tenants when they are in breach of the agreement. There are certain grounds listed under the Housing Act 1988 under which a tenant can be served a section 8 notice. These include failure to pay rent, rent arrears and damage to the property.

Make a section 21 notice or a section 8 notice. For more information, you should also read our guide on how to legally evict a tenant.

For further information read our guide on the legal obligations of a landlord. If you need bespoke advice about becoming a landlord or if you are having issues with your tenants, you can submit a legal question to Ask a Lawyer.