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New leases – what a landlord now needs to know

The news has recently been full of reports of property prices being hoicked up at the last minute, leaving buyers with a dilemma; stick or twist?

By this stage the purchasers are committed; have no option but to move; and then get asked for more money. Other problems that can impede completion include last minute price reductions or a vendor pulling out of the transaction. Purchasers can be left homeless and the effect of the broken link then ripples down the entire buying chain.

The Residential Tenancy Law (Jersey) 2011 came into force on 1st May 2013. It contains protections for the tenant but is also helpful to the landlord, in that it provides guidance on what should be in the lease, which will hopefully reduce disputes further down the line.

What does the law apply to?

It applies to all agreements for exclusive occupancy (i.e. not shared with landlord), for a value (i.e rent), which are less than 9 years in duration, or; ongoing for an indeterminate period, for a property which is deemed to be residential. For a property to be deemed residential by law, it must contain the following amenities as a bare minimum:

  • A shower or bath or other similar facility which is as (if not more) convenient, e.g. a wet room;
  • A washbasin;
  • A kitchen;
  • A sleeping space; and
  • A lavatory.

The Law does not apply to licensees, boarders and lodgers, or to holiday lets of less than 3 months. It is important to take advice if you are not sure if it applies to your agreement.

Provisions

A residential tenancy agreement must contain the following provisions:

  1. A description sufficient to identify the premises being let; usually its address.
  2. The date when the tenancy starts and date or condition upon which it ends.
  3. The name of the landlord.
  4. If there is a managing agent, their name and address. If not, then the landlord’s business address.
  5. The amount of rent to be paid, how often it is to be paid, to whom the rent is to be paid and the payment method.
  6. The amount of any deposit or guarantee in respect of the residential tenancy, as well as how and when any deposit is to be repaid. This is now to be paid to the deposit scheme, which is covered in more detail below.
  7. If, when and how the rent is to be reviewed.
  8. An inventory of all contents belonging to the landlord.

Condition report

As of 31st October 2015, condition reports are compulsory for every new tenancy agreement. They must:

  1. List all the fixed parts of a property and its condition.
  2. List the condition of walls, ceilings and floors in each room.
  3. List the condition of items which are within the above mentioned inventory.
  4. Must be compiled within 7 days of the tenancy agreement.

Further details and a draft condition report can be found on the states website.  There is a penalty for not completing one; a fine of up to £2000.

Deposits

The states approved scheme for holding the deposits is mydeposits Jersey. They charge a fee which is currently £20 (+£1 GST) which is paid out of the tenant’s deposit. Further details of the scheme can be found at:

When the tenant moves out, so long as there are no disputes, the landlord can authorise mydeposits Jersey to release the amount (minus the fee) back to the departing tenant.

If there is a dispute with regards to deductions from the deposit which cannot be agreed between the tenant and landlord, the scheme provides an Alternative Dispute Resolution Service (ADR) to help come to an agreement or compromise.

If you are a landlord and need specific advice on how these changes affect you or want help with a lease or a schedule of commission, please contact us.

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