Here is a question to the blog clinic from Mary (not her real name) who is a landlord
I rent a two bedroomed flat out. The original tenant asked if she could have a friend come to live with her. I said yes.
An Estate Agent takes care of the flat for me. They charge a tenancy fee, and they put this up when I said that another tenant was moving in.
Is this usual? I am wondering if I had known should I have put the rent up to cover the extra 11% cost?
Answer
You need to look at your agency agreement. The fees your agents are entitled to charge you will be set out there.
If there is just one fee listed then they cannot increase this. However, they will be entitled to do this if their agreement specifically says that the fee will increase if there are additional tenants.
If the agents are charging a fee which is not authorised by their agency fee, you do not have to pay it. If the agents insist on charging it, then you can make a formal complaint to their Property Redress Scheme.
I have to say that it sounds like an unfair fee to me. 11% is a lot for one extra person.
Are readers aware of clauses in agency agreements which will increase the agency fee if more people live at the property?
Note by the way that unless a new tenancy agreement was signed, the additional person will not be your tenant but a lodger of the tenant. This can cause difficulties and in some situations allowing lodgers will create an HMO. But not in this case as you cannot have an HMO where there are only two people living in the property.
Would the person not become a tenant if the landlord accepts rent from him/her? With or without a new agreement?
Other than where transfers take place automatically (e.g. on death or on bankruptcy) a tenancy can only be transferred by deed. Accordingly, accepting rent from a third party does not make the third party a tenant.
However (there is always a however) there are situations where an “assignment by estoppel” may arise. That can happen if the landlord acts in such a way that he accepts there has been an assignment. Even though assignments by estoppel are rare in practice, it is good practice for a landlord accepting rent from a third party to make it clear that by doing so he does not accept that the third party is a tenant.
If it does nothing else it will prevent anyone paying rent from arguing he must be a tenant because rent was accepted from him.
Even if the lettings contract does specifically refer to an extra fee for additional tenants, would this this apply to your correspondent since the guest is not a tenant?
No, probably not. But we don’t know what the contract said.
Nothing you put in a tenancy agreement can change the rules about how a tenancy can be transferred.