Difference between a Tenant and a Lodger
Landlords have the option of earning rental income from a rented home or from a spare room in their primary residence. Even though on the surface both rental agreements appear to be similar, they will be viewed substantially differently by the law.
In the simplest terms possible, a tenant and a lodger are distinguished by the fact that a tenant (or a contract holder) is a person that rents out the whole property from a landlord, while a lodger is someone who occupies a room in the home where the landlord lives.
In practice, they are very different from one another, and the agreements they enter into as well as their duties, responsibilities, and rights vary. A Tenant will enter into a Tenancy Agreement, often an Assured Shorthold Tenancy (AST) Agreement in England and in Wales (now known as Occupation Contact), while a Lodger will enter into a Lodgers Agreement and have less rights.
What distinguishes a lodger from a tenant?
Exclusive Possession
A tenant has the right to forbid anyone from entering the property without their permission, even the landlord. The term “premises” might refer to the entire property or just a particular room.
The fundamental distinction is that a lodger is regarded as an excluded occupant and does not have complete possession. As a result, the Lodger does not have sole access to the property. Anybody who shares a residence with the owner is an excluded occupier.
Also, a tenant cannot be transferred to a different room or property during a tenancy because the letting is for a designated space or property. A Lodgers Agreement may stipulate that the Lodger must switch to a different room on the property if necessary.
Notice Periods
Depending on the renting period, this may be for a set amount of time or periodic based on the rental period (i.e. week to week or month to month). A lodger may be asked to vacate the premises with “reasonable notice”. The letter or notice to the lodger should specifically state that you are giving them 28 days’ notice to leave (or whatever length of time you are providing them, but 28 days should be the minimum).
If you are a tenant in Wales (contract holder), the landlord cannot retake possession of the property without giving you at least six months’ notice. However, if the Welsh landlord has a tenant, no fault notices cannot be issued until 6 months after you move in (the occupation date of the contract). In addition a minimum fixed-term contract for a contract holder is 12 months.
What are the main features of a Lodger Agreement?
The main features of a lodger agreement are:
- Without authorisation, the resident landlord may enter the room;
- The landlord cannot be kept out by the lodger;
- The lodger enjoys use of the common areas of the house, including the kitchen, bathroom, and living room.
- The Landlord may ask that the lodger switch to a different room;
- House regulations might be given to the lodger by the landlord;
- Notwithstanding the fact that the landlord must make the property safe for habitation, there are less legal requirements for a lodger than there are for a tenant;
- The landlord usually needs to give “reasonable notice” for the lodger to leave, and they can evict the lodger without a court order if they ever refuse to evacuate their room.
- The notice time for terminating the lodger agreement is shorter and typically depends on the frequency of rent payments.
What are the main features of a Tenancy Agreement?
The main features of a tenancy agreement are:
- Tenants will have sole possession of the property.
- Tenants will need advance notification of any inspections or visits from the live-out Landlord
- Landlords must adhere to all legal safety requirements.
- Landlords are lawfully obligated to provide tenants all required safety certifications for electrical and gas appliances at the start of the tenancy.
- It is a legal requirement for the Landlord to give at least 6 months’ notice to reclaim the property, after the first six months from the start of the tenancy agreement.
- The Landlord must safeguard the deposit with a tenancy deposit scheme.
A live-in landlord has significantly less responsibilities than a live-out landlord. However, both types of landlords should have yearly gas safety inspections performed and be in charge of maintaining the home’s security and absence of any health risks.
To find out more about taking in a lodger or renting out to a tenant, contact a member of our team to help you.
