Short-Term Rental Agreement (Kenya)

A Short-Term Rental Agreement in Kenya is a legally binding contract under the Law of Contract Act Cap. 23 and the Landlord and Tenant Act Cap. 301 through which a landlord grants a tenant the right to occupy residential or furnished accommodation for a defined period not exceeding twelve months, in exchange for the payment of rent. Short-term rentals are commonly used for furnished apartments, holiday lets, serviced residences, staff housing, and temporary accommodation for expatriates or contract workers.

The Landlord and Tenant Act Cap. 301 applies to controlled tenancies in gazetted towns and municipalities across Kenya. Under the Act, a controlled tenancy is a residential or business tenancy where the annual rent falls within the controlled rent limits gazetted under Section 2 of the Act. For short-term furnished lettings above the controlled rent thresholds — particularly in Nairobi, Mombasa, Kisumu, Nakuru, and other major urban centres — the parties have greater freedom to agree terms, but the Act still governs the procedure for recovery of possession and the permissible grounds for eviction.

The Rent Restriction Act Cap. 296 continues to apply alongside the Landlord and Tenant Act Cap. 301 in respect of certain older residential tenancies at controlled rents below the Rent Restriction Act thresholds. For modern short-term furnished lets at market rents in Nairobi's Kilimani, Westlands, Lavington, Kileleshwa, and other upper-market suburbs — where monthly rents typically range from KES 40,000 to KES 500,000 — neither the Rent Restriction Act nor the controlled rent provisions of the Landlord and Tenant Act Cap. 301 impose substantive rent control, giving landlords and tenants broader contractual freedom.

The Land Act No. 6 of 2012 and the Land Registration Act No. 3 of 2012 govern the underlying title to the property being let. A short-term rental of residential premises does not constitute a legal lease requiring registration under the Land Registration Act No. 3 of 2012 — only leases exceeding three years must be registered under Section 54 of the Land Act No. 6 of 2012. Short-term rental agreements are therefore purely contractual instruments and take effect upon signature without any land registration formality.

The Public Health Act Cap. 242 and the county government public health by-laws impose habitability standards on residential premises — including adequate ventilation, sanitation, and water supply — that landlords must maintain throughout the tenancy. The National Environment Management Authority (NEMA), established under the Environment Management and Co-ordination Act No. 8 of 1999, administers environmental standards that affect multi-unit residential developments, particularly regarding waste disposal and noise levels.

For short-term furnished holiday lets and serviced apartments operating as a business, the Tourism Act No. 28 of 2011 administered by the Tourism Regulatory Authority (TRA) may require the operator to hold a Tourism Regulatory Authority licence. The Kenya Revenue Authority (KRA) treats rental income as taxable under the Income Tax Act Cap. 470, and landlords earning rental income above the annual exemption threshold must file annual returns and pay Residential Rental Income Tax at 7.5% of gross rental receipts under the Finance Act provisions, without deducting expenses.

A Short-Term Rental Agreement in Kenya is required whenever residential premises are let for a period of twelve months or less, particularly where the tenancy is for a fixed duration, the property is furnished, or the parties want certainty about the terms governing rent, deposit, utilities, repairs, and the process for ending the tenancy.

A Short-Term Rental Agreement is needed when a landlord lets a furnished apartment in Nairobi, Mombasa, or another Kenyan city to a new employee, expatriate, or contractor on a fixed-term basis. Employers and relocation agents routinely require a signed rental agreement before an employee takes occupation, and the agreement defines the rent, the included services, and the notice required to terminate.

A Short-Term Rental Agreement is required when a homeowner lets their property for holiday accommodation or corporate housing through a property management company or directly through a listing platform. The agreement specifies the permitted use, the maximum occupancy, the house rules, the security deposit, and the check-in and check-out procedures.

A Short-Term Rental Agreement is needed when a tenant in an existing long-term lease sub-lets with the landlord's written consent. The Landlord and Tenant Act Cap. 301 requires the landlord's consent for subletting, and the sub-tenancy should be formalised with a written agreement that does not create rights exceeding those of the head tenant.

A Short-Term Rental Agreement is required for student accommodation lets near Kenyan universities and colleges, where the academic term structure generates demand for semester-length tenancies of four to five months. Without a written agreement, a student tenant may claim the protection of the Landlord and Tenant Act Cap. 301 and resist eviction at the end of term.

A Short-Term Rental Agreement is needed when a company lets staff housing for employees on fixed-term project assignments. The agreement records the employment-linked nature of the tenancy and establishes that the right to occupy terminates automatically when the employment ends, preventing the employee from claiming security of tenure as a personal tenant after employment ceases. Under Kenya law, Section 24 of the Land Registration Act 2012 (No. 3 of 2012) and Section 2 of the Law of Contract Act (Cap 23) govern the core requirements for this type of document.

A Kenya Short-Term Rental Agreement under the Landlord and Tenant Act Cap. 301 and the Law of Contract Act Cap. 23 must contain the following key elements to be legally enforceable and operationally sound.

Parties and Property: Full legal names and National Identity Card (NIC) numbers or Business Registration Service (BRS) numbers of the landlord and tenant; the full address and land reference number or plot number of the premises; and — where the landlord is a company — confirmation that the company is duly incorporated under the Companies Act No. 17 of 2015. The landlord's KRA PIN for rental income reporting under the Income Tax Act Cap. 470 should be recorded.

Tenancy Period and Dates: The precise start date and end date of the tenancy; whether the tenancy automatically ends on the expiry date or continues as a periodic tenancy month-to-month; and the notice required from each party to terminate before the end of the fixed term. Under the Landlord and Tenant Act Cap. 301, notice to quit for a monthly tenancy must be at least one month's notice expiring at the end of a rental period.

Rent and Payment Terms: The monthly rent amount in Kenya Shillings (KES); the due date (first or fifth of each month); the acceptable payment methods (M-Pesa paybill, bank transfer, or cash); and the landlord's bank or M-Pesa account details. The agreement should state whether rent includes VAT under the VAT Act No. 35 of 2013 — VAT at 16% applies to commercial rent but not to residential rent.

Security Deposit: The deposit amount (typically one to three months' rent); the conditions under which deductions may be made (unpaid rent, utility charges, or repair of damage beyond fair wear and tear); the deadline for refunding the deposit after vacation (typically 14 to 30 days); and the procedure for disputing deductions. The Landlord and Tenant Act Cap. 301 does not prescribe a maximum deposit amount for non-controlled tenancies.

Utilities and Services: Which utilities are included in the rent (water, electricity, internet, cable TV, security service charge) and which are payable separately by the tenant directly to the service provider or as a top-up payment to the landlord. Kenya Power and Lighting Company (KPLC) electricity bills, Nairobi City Water and Sewerage Company bills, and county government service charge levies should be addressed.

Furnishings and Inventory: For furnished lets, a schedule of furnishings, appliances, and equipment included in the tenancy — with their condition at check-in noted — attached as an annex to the agreement. The inventory should be signed by both parties at the start and end of the tenancy to provide an objective basis for any deposit deduction claim.

Repairs and Maintenance: The landlord's obligation to maintain the structure, roof, plumbing, and electrical installations in habitable condition under the Public Health Act Cap. 242; the tenant's obligation to maintain the interior, fixtures, and furnishings in good order; the process for reporting defects; and the emergency repair procedure.

Prohibited Uses and House Rules: The permitted use (residential occupation only); the maximum number of permitted occupants; restrictions on pets, smoking, subletting, and alteration of the premises; and the tenant's obligation to comply with the rules of any estate management company or owners' corporation applicable to the building.

Termination and Eviction: The grounds on which either party may terminate early; the procedure for recovering possession through the Magistrates Court under the Landlord and Tenant Act Cap. 301 where the tenant refuses to vacate; and the landlord's right to claim mesne profits (occupation charges at the contractual rent rate) for any period of holding over after the tenancy end date. Forms-legal.com provides a Kenya Short-Term Rental Agreement template that covers all these essential elements and is aligned with the Landlord and Tenant Act Cap. 301. Under Kenya law, Section 24 of the Land Registration Act 2012 (No. 3 of 2012) and Section 3 of the Companies Act 2015 (No. 17 of 2015) govern the core requirements for this type of document.