Property Jargon Buster for First Time Renters

If you're new to renting and have come across some phrases you're not familiar with during your search, you're not alone! When it comes to signing your tenancy agreement you're likely to come into contact with a number of the words, terms and abbreviations listed below. We've provided explanations of what they mean to act as a plain English guide to some of the most commonly used expressions in the property sector. 

ARREARS

Arrears is a legal term used when rent is outstanding. Arrears can be the full amount for a rental period or in part. You can get advice if you're in rent arrears or having difficulty paying your rent from Shelter, Citizens Advice or the Money Advice Service. 

AST (ASSURED SHORTHOLD TENANCY)

An assured shorthold tenancy is the most common form of tenancy agreement used involving a residential landlord and is commonly abbreviated to AST. A tenancy can be an AST if all of the following apply: the property is private, the tenancy started on or after 15/01/1989, the property is your main accommodation and the landlord does not also live in the property. 

BREAK CLAUSE

A break clause is sometimes included in a fixed term tenancy agreement and can provide both the tenant and the landlord the opportunity to terminate the agreement early, for example a 12 month tenancy could be terminated after 6 months. Typically a break clause is included if the initial fixed term is greater than 1 year. You should never assume your contract includes a break clause, always check with your letting agent. 

COUNCIL TAX

Council Tax is a local authority tax that applies in England, Scotland and Wales. It is usually the responsibility of the tenant to pay however some properties are let on a bills inclusive basis. Costs can vary depending on the property type, number of bedrooms and location. 

CREDIT REFERENCING 

Before an agreement is drawn up you will be referenced by your agent or landlord. They will carry out the necessary employment, residential and credit history checks to assess your ability to pay the rent on the property. 

DEPOSIT

Your agent or landlord will ask new tenants to pay a deposit to cover any damage to the property or unpaid rent during the tenancy term. The amount can vary depending on the landlord and what they deem appropriate but is typically valued between 1 month and 6 weeks rent. Your deposit should be held by a government backed tenancy deposit scheme such as the Deposit Protection Service, MyDeposits or Tenancy Deposit Scheme. 

EPC (ENERGY PERFORMANCE CERTIFICATE)

Every property offered to let requires an energy performance certificate, commonly abbreviated to EPC. An EPC provides a rating for the property and its energy efficiency, running costs and carbon emissions. EPC's need to be renewed every 10 years and it is the responsibility of the agent or landlord to coordinate this if the renewal is due to take place during your tenancy term. 

FIXTURES & FITTINGS

The term fixtures and fittings applies to the contents of a rented property, for example: window coverings, light fittings, carpets, kitchen units and white goods. If you're renting a furnished property, furniture will also fall under this category.

GAS SAFETY REGULATIONS

A gas safety check must be carried out prior to letting a property and then every year thereafter. The check must be carried out by an authorised, registered engineer and a copy of the record must be provided to the tenant. Be aware that not every property has gas on site so sometimes this will not apply.

GUARANTOR

A guarantor is a third party, for example a parent or relative, who signs a legally binding contract agreeing to pay the rent  in the event you default on any payments. Landlords can legally obtain any unpaid rent from your guarantor. 

HMO (HOUSES IN MULTIPLE OCCUPATION)

Your property is classed as a house in multiple occupation if at least 3 tenants live there, forming more than 1 household and there are shared bathroom or kitchen facilities. House shares where there are no family relationships are a good example of an HMO. 

INVENTORY 

An inventory is a listing of the contents of the property. The list often includes the condition of the property and any outside areas as well as any fixtures and fittings. There should be an inventory made available to the new tenants upon check in which can be updated with any amendments (normally within a certain amount of days). This can then be checked against the condition of the above at the end of the tenancy. 

MANAGING AGENT

This term refers to the property and the agent or company responsible for addressing any maintenance issues. Not all properties are professionally managed so your landlord may be responsible however this should be outlined to you prior to signing your tenancy agreement. If you live in an apartment or flat there may be different companies responsible for managing the property and any communal areas. 

NOTICE

This term refers to the period of time that a tenant or landlord must provide to end the tenancy agreement. 

PCM (PER CALENDAR MONTH)

PCM is an abbreviation referring to the rental amount for the property being paid on a calendar month basis, for example is an advert for a property indicates the rental amount is £600 PCM then the rental amount is £600 per calendar month.

PERIODIC 

A periodic tenancy continues for successive periods until the tenant gives the landlord notice that they want to terminate the tenancy and vacate the property. When an AST ends, the tenancy will become a periodic tenancy unless the landlord states otherwise or tenant chooses to sign a renewal document. 

PRESCRIBED INFORMATION

This term relates to your landlord or agent being legally obligated to provide information relating to the protection scheme used to protect the deposit for the property. 

RENEWAL

At the end of an AST some tenants and landlords will choose to renew the tenancy for another fixed term. It would be at this point that a landlord can change the terms of your agreement, for example the cost of the rent. 

STANDING ORDER

A standing order is an instruction to an account holders bank to make regular fixed payments to a particular person or company, usually on a monthly basis. A standing order is commonly used to make rent payments. Only the person whose bank account is being used to make the rent payments can cancel the standing order. A standing order is not the same as a direct debit which is a method more often used when payments differ monthly and is not often used to make rent payments. 

SUBLET

When an existing tenant lets part or all of their home to another person, this is a term referred to as subletting. Your tenancy agreement will state whether you are allowed to sublet and will also specify whether written permission is required from your landlord before subletting. If you sublet part of your rental property without permission, your landlord can take legal action against you. 

TENANCY AGREEMENT

A tenancy agreement is signed before the property is let out. It is a contract between the landlord and the tenant/s that sets out the terms and conditions of the rental agreement. 

 

Last Updated: 15/08/2017
Author: Cactus Living

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