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Question

England | Start of a Tenancy (England) | Types of Tenancies (England)

Is a Tenant Repair Lease possible on a residential tenancy?

9 Jan 2022 | 4 comments

Excellent tenants (lady with two children and her partner) that we’ve had for several years, would like to move into one of our properties with a view to purchasing it in 4 years’ time.

They can only afford a substantially lower rent than what we are getting renting it out as an HMO, but they are proposing to take over the responsibility and cost of all the repairs and maintenance during these 4 years.

Is it possible to grant them a 4 year Residential Tenancy on such terms?

If not, what would be the nearest form of Tenancy Agreement we could use? The property is mortgaged.

Answer

4 Comments

  1. guildy

    Unfortunately, this is impossible.

    The repairing legislation expressly states that any contract to make tenants liable for repair will have no effect and landlord is always liable.

    The only way to avoid is to grant a tenancy of at least 7 years but this isn’t something we have available and other issues can arise when giving long tenancies like that.

    Also, in our experience, these kind of bespoke arrangements never work. The tenant will have great plans and ideas now but don’t materialise. They would unlikely keep it in repair so you would end up with a deteriorating property and not receiving normal rent.

    We’ve seen similar where the tenant agrees to put a new kitchen in (for example), in exchange for a reduced rent. In reality what you end up with is a poorly designed, poor quality and poorly fitted kitchen which needs replacing when they leave (so might as well not have bothered)!

  2. laetitia

    Thank you for confirming what we thought!
    Maybe we could tell them that every year we review what we have spent on repairs and maintenance and increase the rent by that amount? This may encourage them to have work done themselves…

  3. guildy

    This sounds complicated and prone to argument in our view.

    If you make some kind of arrangement like this, it shouldn’t be in the tenancy, as the tenancy should be kept simple and normal.

  4. laetitia

    The arrangement would only be verbal. We take your advice of not including any rent review clause in the actual tenancy agreement.

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