Fixed rental charges or actualised charges?

Updated: Apr 8, 2020

Co-rentals do not fall under the general rental legislation of 2006 so quite often the charges are fixed for ease of management. It is up to the landlord to evaluate as accurately as possible what the charges will be. Tenants must be careful that they are not charged outrageous expenses but as it is something they find out before signing a contract, they always have the possibility to say no. The contract must therefore specify that the charges are fixed and not adjustable as a later stage.

Ordinary rentals, however, come with monthly fixed charges which then must be adjusted in relation to the actual costs. Again for ease of management, it is best to ask for a monthly fixed amount. When actual charges are billed to the landlord, he/she has a duty to adjust, ask for an extra payment or reimburse some monies depending on the final balance. The tenant has the right to request copies of actual costs to ensure the billing is correct.

There is one problem though. Bank warranty must be returned to the tenants no later than 6 months if the rental is an apartment (3 months in the case of a house). When the rental is an apartment, it is the management company which receives the invoices and which in turn invoices each landlord. Then the landlord can calculate what is the final balance owed by the tenant. This process is lenghty and the final costs often are known more than 6 months after the tenant has left the property. This explains why landlord are reluctant to release in full the warranty before the due date.

Obviously it is best to remain in good terms with the landlord, especially if a refund is expected. I have come across cases where former tenants were reimbursed by their landlords for over-paid charges a year after their departures. On both sides it is all about honesty.

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