Private Rent and Tenancy Agreements

When it comes to private rent property, it is important to understand the difference between the different tenancy agreements available for landlords in the UK. We outline the most common forms of tenancies you might expect when renting your property.

Assured Shorthold Tenancies

This type of agreement is also referred to as an “AST” or “Shorthold Tenancy” and is the most common in the private renting.  AST’s provide the one paying tenant with the right to:

• Control their home (stop others – including landlords – from freely entering).
• Challenge rent increases
• Get certain repairs done (windows and doors, roofs, guttering and walls, not internal decoration).
• Pass on your tenancy to somebody else. Only acceptable if:
  • You die
  • There is already a provision in the agreement that allows this.
  • The landlord agrees to it.
• Live in your accommodation until the landlord gets a court order to evict.

Assured Shorthold Tenancies can either be Periodic or Fixed-term. Fixed-term tenancies run for a set amount of time whereas the periodic tenancies have no fixed end date and run on a week-to-week or month-to-month basis.

There are other tenancies that aren’t as common as ASTs, including:

• Regulated Tenancies

• Excluded tenancies

• Assured Tenancy

Regulated Tenancies

Tenancies starting before 15 January 1989 may be regulated. While regulated tenancies no longer exist, some long-term contracts are still in use.  Your tenants have increased protection from eviction and can appeal to the Residential Property Tribunal and  apply for a ‘fair rent’.

Excluded tenancies or licences (Lodgers Agreement)

If rent a room out in your only or principal place of residence and share rooms with them, like a kitchen or bathroom, you are said to have a lodger. Resident Landlords have greater freedom to evict than most other Landlords, should the relationship breakdown, or the landlord feel uncomfortable in his own home. In this case, resident tenants also have very little power to challenge rental increases, unlike non-residential tenants.

There are some cases in which an excluded tenancy becomes simple a licence to occupy (or Excluded licence). These are:

• The occupier does not have the right to occupy a room/certain rooms and/or
• There is no rent payable for occupying the room and/or
• The occupation is not running for identifiable amounts of time, for example, by the week or by the month, then the arrangement is also likely to be a licence.

Common general examples of licences are staying in a hotel or staying in friends house for a few days. Tenants have some rights that licensees do not.

Assured Tenancy

Assured tenancies are usually granted by Housing Associations or Housing and applied to those tenancies starting between 15 January 1989 and 27 February 1997.

The main differences between an assured and a shorthold tenancy are the following:

• With a shorthold tenancy, the landlord can regain possession of the property six months after the beginning of the tenancy, provided that he or she gives the tenant two months’ notice requiring possession.
• With an assured tenancy, the tenant has the right to remain in the  property unless the landlord can prove to the court that he or she has grounds for possession.
• The landlord does not have an automatic right to repossess the property when the tenancy comes to an end.
• The landlord can charge a full market rent for an assured or a shorthold tenancy.
• Most landlords let on shorthold tenancies and many are happy to grant a tenant a further tenancy when the first tenancy comes to an end. However, if a tenant would like the security of knowing that the landlord cannot automatically regain possession after six months, it would be possible to negotiate an assured tenancy, or a shorthold tenancy for a fixed term.

If you are unsure which type of tenancy you want to sign for your rental property, you should seek legal advice.