What is a Tenancy Agreement and Why Do You Need One?
A tenancy agreement — also called a rental agreement or lease — is a legally binding contract between a landlord (the property owner) and a tenant (the person renting the property). It sets out the terms and conditions under which the property is rented, including how much rent is paid, when it is due, how long the tenancy lasts, and what happens if either party wants to end the arrangement.
In Kenya, many tenancies — especially in informal settlements and private arrangements — are done verbally. This is a serious mistake. Without a written tenancy agreement, you have almost no legal protection if a dispute arises. A tenant can refuse to vacate. A landlord can raise rent without notice. Deposits disappear with no record. The courts will struggle to determine what was agreed.
Tenancies in Kenya are primarily governed by the Landlord and Tenant (Shops, Hotels and Catering Establishments) Act (Cap 301) and the Rent Restriction Act (Cap 296). For residential tenancies, general contract law and the Law of Contract Act (Cap 23) also apply. A written agreement is not always legally required, but it is the strongest evidence of what was agreed.
Who Needs a Tenancy Agreement?
A tenancy agreement is essential for any rental arrangement — whether you are renting a bedsitter in Kayole, a maisonette in Karen, a commercial stall in Gikomba, or an office block in Westlands. It applies to:
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01Residential LandlordsAnyone renting out a house, apartment, bedsitter, or room to a tenant for residential use.
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02Commercial LandlordsProperty owners renting out shops, offices, warehouses, or market stalls to businesses.
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03TenantsAnyone paying rent should insist on a written agreement — it protects you just as much as it protects the landlord.
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04Caretakers & Property ManagersIf you manage property on behalf of an owner, a written agreement protects you from disputes with both the owner and tenants.
What Must a Tenancy Agreement in Kenya Include?
While the law does not specify an exact format, a valid tenancy agreement in Kenya must clearly address the following key areas. Missing any of these is where disputes begin.
1. Full Identification of Both Parties
The agreement must state the full legal names, ID numbers, and contact addresses of both the landlord and the tenant. If a company is a party, include the company registration number.
2. A Clear Description of the Property
Specify the exact address and a description of the premises being rented — for example, "House No. 4B, Woodlands Estate, Thika Road, Nairobi." Include a description of what is included (furniture, parking bay, store).
3. The Rent Amount and Payment Terms
State the monthly rent in Kenya Shillings. Include the due date (e.g., "payable on or before the 5th of each month"), the accepted payment method (M-Pesa, bank transfer, cash), and consequences for late payment.
4. The Security Deposit
State the deposit amount, what it covers (unpaid rent, damage beyond normal wear and tear), and the conditions for its refund. In Kenya, the typical deposit is one to two months' rent.
5. The Duration of the Tenancy
Specify whether this is a fixed-term tenancy (e.g., one year from 1 March 2026 to 28 February 2027) or a periodic tenancy (month-to-month). This determines the notice required to terminate.
6. Notice Period for Termination
Clearly state how much notice is required to end the tenancy — typically one month's written notice for monthly tenancies. This is critical. Many disputes in Kenya arise because this was never agreed in writing.
7. Permitted Use of the Property
State the purpose for which the property may be used — for example, "residential use only." This prevents a tenant from operating a business from a residential property without the landlord's consent.
8. Responsibility for Utilities and Maintenance
Specify who pays for water, electricity, garbage collection, and internet. Also clarify who is responsible for repairs — for example, "the tenant is responsible for minor repairs under KSh 2,000; the landlord is responsible for structural repairs."
9. Rules and Restrictions
Include any house rules: whether pets are allowed, whether sub-letting is permitted, rules on noise, whether alterations to the property are allowed, and the number of occupants permitted.
10. Dispute Resolution
Agree on how disputes will be resolved — through negotiation, mediation, or referral to the Rent Restriction Tribunal or courts. Specifying jurisdiction (e.g., "the courts of Nairobi County") speeds up any legal process.
These are the most common errors we see in Kenyan tenancy agreements: failing to specify the notice period; not recording the deposit in writing; using a template from another country (South Africa or the UK) that doesn't reflect Kenyan law; not having the agreement signed by both parties and witnessed; and not including a clause on what happens when rent increases.
Does a Tenancy Agreement Need a Lawyer in Kenya?
For a standard residential tenancy agreement, you do not legally need a lawyer to draft or sign the agreement. Both parties can sign directly and the agreement is legally binding.
However, for commercial leases, long-term leases of more than one year, or high-value properties, we strongly recommend involving a qualified advocate to review or draft the agreement. The stakes are simply too high to risk a poorly worded clause.
| Type of Tenancy | Lawyer Required? | Recommended? |
|---|---|---|
| Standard residential (house, apartment) | No | Template is sufficient |
| Commercial (shop, office, warehouse) | No, but advisable | Yes — review recommended |
| Long-term lease (over 3 years) | Must be registered | Yes — lawyer required |
| High-value property (above KSh 100,000/month) | No | Yes — strongly advised |
How to Sign a Tenancy Agreement in Kenya
Once the agreement has been drafted and both parties are satisfied with its terms, follow these steps to execute it properly:
Step 1: Print two original copies of the agreement — one for the landlord and one for the tenant.
Step 2: Both the landlord and tenant sign both copies in the presence of at least one witness each.
Step 3: The witnesses sign and write their full names, ID numbers, and the date.
Step 4: Each party retains a signed original. Keep it safely — you may need it in court.
Step 5: The deposit should be paid and acknowledged in writing on the same day, or use a separate receipt that references the agreement.
Do a joint inspection of the property before the tenant moves in and document the condition in writing — note any existing damage, mark it on the agreement or an attached inventory sheet. This prevents disputes about the deposit when the tenant eventually vacates.
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Download Tenancy Agreement Template →What Happens When There is No Written Agreement?
Without a written tenancy agreement, both parties are exposed to significant risk. If a dispute goes to the Rent Restriction Tribunal or the courts, the judge will look for evidence of what was agreed. Verbal agreements are almost impossible to prove.
In practice, the consequences include: tenants who refuse to vacate with no clear legal basis to remove them quickly; landlords who cannot justify retaining deposits; rent arrears that are difficult to quantify without payment records; and costly, time-consuming court proceedings that could have been avoided entirely.