Lodgers Agreement - Guide for UK Landlords

What is a Lodger?

A lodger is someone who lives in your home and shares common areas like a kitchen, bathroom or living room with you. They could be a friend or family member, but they don’t have to be. This is usually a less formal arrangement than if you were to let out a property that you don’t live in to tenants, but there are still some rights and responsibilities that both parties should adhere to. You should have an agreement contract with your lodger that includes how much rent they will pay, payment dates, house rules and more.

Benefits of Taking in a Lodger

Having a lodger can provide you with some extra income that is tax-free up to £7,500 under the government’s Rent A Room scheme. This can provide you with some extra funds to cover expenses or to invest in future projects. You can set the amount of rent and increase it if stated in the lodger’s agreement, and you give reasonable notice. You should have a lodger agreement in place, although it will be more informal and flexible than full tenancy agreements. Some people like having a lodger in their home for safety and security reasons if they live alone, or like having an extra pair of hands to help with household chores and gardening. Landlords with lodgers can also set house rules according to their own preferences and lifestyle.

Drawbacks of Taking in a Lodger

The main disadvantage of taking in a lodger is that you would have to share your living space with them – if you don’t want this, then having a lodger is not for you. They could also put extra wear and tear on the property, leading to more required maintenance, or even damage the property, whether by accident or through negligence. Much like having tenants, you are responsible for keeping the property safe and in good repair. You need to have gas safety certificates in place, install smoke and carbon monoxide alarms, and supply fire extinguishers. All appliances should be in safe working condition, and furniture used by the lodger should comply with the Fire Safety Regulations 1987 – this should not be a problem if you bought the furniture in the UK after 1988. You should also perform a Right to Rent check on lodgers, just like you would with tenants.

FAQ: Can I take in a lodger if I rent my home?

If your home is rented, then a lodger is considered a subtenant. The owner of the property needs to consent to you having a subtenant; otherwise, it is illegal subletting and could be grounds for eviction. You should also inform the local council (for council tax purposes), your insurance provider, and mortgage lender that you are taking in a lodger.

Legal Differences Between a Lodger and a Tenant

A lodger is someone who shares the property, including communal areas, with their landlord, and the landlord has access to all areas of the property, including the lodger’s bedroom. The landlord may provide services to the lodger, such as cooking, cleaning, etc. The property is also the landlord’s main residence. If someone rents an entire property from a landlord, that property is not the landlord’s main residence most or all of the time, and they have exclusive rights to certain areas of the property, e.g. their bedroom, then this is a tenant and should have a tenancy agreement in place. Lodgers have a licence to occupy the property, and can be asked to leave with reasonable notice, which is usually 28 days. Tenants have stronger legal protections under the Housing Act 1988, and you must follow legally prescribed eviction processes to get a tenant to leave your property.

What Should Be in a Lodger’s Agreement?

While a lodger’s agreement is not a legal requirement, it is strongly recommended to have one. It should include the names and contact details of both parties, the amount of rent the lodger pays and the due date, and the notice period for ending the agreement. You can take a deposit from a lodger, but you don’t have to – all deposits should be held in a secure deposit protection scheme. The lodger’s agreement can also contain other information like house rules about what areas of the property the lodger can use, rules about guests, pets, smoking or other issues, and anything else relevant to sharing the house. Having a document like this can help if any disputes arise between the lodger and landlord.

Setting House Rules and Boundaries

To avoid any misunderstandings or future problems, it’s best to discuss expectations of both landlord and lodger upfront. You can include agreed-upon rules in your lodgers’ agreement about noise levels, chores and cleaning, having guests visiting the property, whether or not smoking or pets are allowed, and more. Setting these ground rules early on will help maintain a good relationship between lodgers and landlords.

Ending a Lodger Agreement

You can usually end a lodger agreement with reasonable notice. This is usually 28 days, but can be less if agreed in writing. As long as the lodger has no exclusive possession (e.g. keys to a lockable private space), they have limited rights to remain in the property after notice is served. If issues arise, it is best to handle them calmly and professionally. In rare cases where a lodger refuses to leave, you may need to apply for a possession order from the courts, but this is uncommon.

Taking in a lodger can be a low-risk way to supplement your income and make good use of an extra room in your home, but it’s important to stay informed and protected. A well-drafted lodger’s agreement and a clear understanding of your rights and responsibilities can prevent any problems before they start. Always take the time to check on your prospective lodger to ensure they have the right to rent in the UK and agree to your terms before moving in.

To find out more about how to make money through property, join me and other other property investment gurus at one of Assets For Life’s FREE property events – click the link below to learn more or sign up.