Key Points of a Tenancy Agreement
But what exactly are the key points of a tenancy agreement? Besides the general details of the property, landlord and tenant?
A tenancy agreement plays a key role in all tenancies between landlords and tenants. It’s a contract that details the conditions, policies and terms of the tenancy. How long the tenancy is, what the tenant can do, the landlord’s responsibilities and more. Below we’ve highlighted key points of a tenancy agreement that relates to important tenancy agreement clauses that you need to know.
- Rental value and deadline
- Length of the tenancy
- Tenant’s obligations
- Landlord’s obligations
- The conditions for early termination
- Termination of tenancy
- Renewal of tenancy agreement
- Eviction
Rental value and deadline
One of the most important things that your tenancy agreement should cover! So just in case if misunderstandings or conflicts occur, your tenancy agreement will serve as proof and reference.
In this part, the contract should tell you when the amount is due, agreement that the tenancy is broken when the tenancy is terminated early and the conditions for moving in.
Length of the tenancy
A tenancy period/length of tenancy is defined as a set amount of time during which the tenant occupies the property. Landlords must also be particular about the term and duration of the agreement while drafting it.
Typically, the tenancy agreement is for a year at a time. One-year, two-year, and three-year durations are the most prevalent. For the reason that any tenancy agreement that lasts longer than three years is considered a lease rather than a tenancy.
Instead, if you’re renting on a monthly basis, make a note of it. Indicate the date on which the contract was signed, as well as the start and end dates of the renting period.
Tenant’s obligations
The obligations and responsibilities of the tenant such as:
- Paying the rent to the landlord or authorized party through a specific payment method such as credit card or debit card
- What the tenant has to pay for – including or excluding inconvenience benefits (e.g: utility bills, water bills, electricity bills)
- Not bringing or allowed to bring guest(s) over to the property
- Allowing the landlord to conduct regular checks
- Not subletting to other people
These are but some of the tenant obligations or responsibilities of the tenant that a tenancy agreement generally has.
Landlord’s obligations
For the landlord, the tenancy agreement should specify or touch upon his/her obligations such as:
- Maintaining the property and conducting regular checks
- To insure and keep the property insured with a credible insurance company
- Lease the property only as authorised
- Render the property unfit for use if there is extensive damage
The conditions for early termination
A common issue for landlords is when tenants suddenly have to leave. Or when issues rise and tenants have to terminate their tenancy early.
The tenancy agreement should specify what to do when the tenant or landlord has to terminate the tenancy early. And also, what conditions must be fulfilled for the early termination to happen.
For example, the tenant having to pay at least two months’ of utility bills and clear all their stuff before moving out.
Termination of tenancy
Here, it should split into two sections. The conditions for terminating the tenancy agreement as a landlord, and also as a tenant. It should explain what they need to do at the end.
I.e: Forfeiture of Tenancy by Landlord
- Breach: the tenant has breached their obligation as per Agreement, and in the case that the breach cannot be remedied or not remedied within a reasonable time
- Insolvency or bankruptcy: the tenant has become bankrupt or unable to pay their debts
Renewal of tenancy agreement
The tenancy agreement should also state what needs to take place for the renewal of the tenancy agreement. For example, the tenant has to notify the landlord a month in advance about the renewal for the landlord to draw up another tenancy agreement.
Eviction
Landlords can’t just simply evict tenants. Eviction requires evidence or legal grounds to do so, otherwise, if brought to court, can’t hold up. Reasons for eviction include tenant repeatedly not paying rent, the violation of the agreement and more.
All evidence should be documented and collected for sufficient proof. Keep in mind that eviction takes some time, and will take some money as well. Eviction is basically the last thing you want to do, so make sure you’ve tried talking with your tenant and stuff before you do so.
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Related guides
Next step: tenancy agreement charges.
Next step: stamp a tenancy agreement online.
Next step: See the full Malaysian tenancy agreement guide — every clause explained in plain English, with the negotiating room landlords commonly miss before signing.
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