Factsheet 18 - Residential Tenancy Agreements

 

Residential Tenancy Agreements

A look at the different types of residential tenancy in England and Wales 

Introduction:

An occupier (or group of occupiers) of residential property who enjoys exclusive use or possession of his accommodation will normally classify as a tenant and will have important rights in law. By comparison, there are other types of occupation which enjoy significantly less rights (such as licencees and trespassers) but these will not be dealt with further here.

For the landlord, it can be very important to understand exactly which type of tenancy has been granted to the tenant. When bringing a possession action, the type of tenancy will determine which notices need to be served.

Assured & Assured Shorthold Tenancies:

Most tenancies (in the private sector) will, nowadays, be granted as assured shorthold tenancies but it will not be safe to simply assume that this is always the case. There are a number of important exceptions, such as tenancies with a resident landlord, lettings to companies, and lettings at high rent (i.e. over £100,000* rent per annum) – these are discussed further below (see ‘Exclusions’) and in the flowchart on the final page.

Assured Shorthold Tenancy (AST)

The Housing Act 1988 introduced a new class of tenancies called assured tenancies, which include the assured shorthold tenancy, and the ordinary assured tenancy. The assured shorthold tenancy is the standard form of letting for tenancies which began on or after 28 February 1997.
If the landlord lets a property on an assured shorthold (AST), he is entitled to, and guaranteed, the right to regain possession at the end of the term subject to the statutory notice requirements:

  • the landlord must give 2 months' notice that possession is required
  • possession will only be awarded after six months

The AST tenant may apply to the appropriate tribunal (First-tier tribunal - Property Chamber in England and Rent Assessment Committee in Wales) to have the rent reduced if he considers the rent to be significantly higher than the rent for comparable tenancies in the area. With effect from 28 February 1997, the AST is the default or automatic tenancy, and it is no longer necessary to serve a separate AST notice (s.20) on the tenant.

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