Different Types Of Tenancies

by Editor on May 6, 2013

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For anyone who is renting, or considering the rental of a property, this is a breakdown of the rules as they apply in most cases. These rules, however, do not apply to anyone that is renting a room inside a private residence. This article is a basic guide and is not a substitution for a legal or professional advice.

Definitions of Tenancy

The two main types of tenancy discussed here are assured and shorthold. An assured tenancy gives the tenant the right to occupy the property unless they have been served with a court-ordered eviction from the landlord. With a shorthold tenancy, the landlord has a right to reclaim the property after six months of being occupied.

Other definitions of an assured or shorthold tenancy –

  • A tenant agreement exists between the tenant and landlord
  • Tenancy began on or after January 15, 1989
  • The property is the tenant’s main residence and is separate from other property

This does not apply to –

  • Property rented over the holidays or for business purposes
  • Tenancies that took place before January 15, 1989
  • Rental situations where there was no charge or the rates were way above or under the current market rates
  • Rentals that occurred inside the landlord’s private home
  • In the case of assured and shorthold tenancies, the landlord is to charge the fair market rate on any property let to another party.

These rules apply to assured and shorthold tenancies –

  • New tenancies are considered shorthold unless they are notified in writing by the landlord
  • If the tenant is behind in rent by two months or more, the landlord reserves the right to reclaim the property
  • Tenants may be evicted by the landlord if there are repeated complaints of noise and other distractions
  • Tenants may receive a statement of the main details of the tenant agreement if the landlord fails to provide this for a new or former shorthold lease agreement
  • Tenants may refer their rent to a rent assessment committee during the first six months of occupancy
  • Tenants are to be evicted with a court order only

If you are not sure about the type of letting agreement you have, the Citizen’s Advice Bureau is a good resource.

Is There a Time Limit on Tenancy?

In the case of both types of tenancies, they may run for a fixed term or from month-to-month, also known as contractual periodic tenancy.

Does a Shorthold Tenancy Have to Be Fixed Term?

Although most have a minimal term of six months, this is entirely left up to the landlord. In cases where the mutually agreed time is less than six months, the landlord does not have any right to possession during this time.

Is a Written Tenancy Agreement Necessary?

While this is not mandatory, having a written agreement in place may protect both the tenant and landlord in the case of a legal dispute.

Is it Legal for the Landlord to Charge a Deposit?

Yes, it is legal to request this before occupying a rental property. This protects the landlord in case of any damage that may occur while the property is being occupied. The landlord is required by law to submit deposit to an approved Deposit Protection Scheme.

Is Having a Rent Book Necessary?

Only in cases where the tenant pays rent weekly. If no rent book is available, tenants and lodgers may request receipts or other payment confirmation.

Can Letting Agents Charge a Fee?

While letting agents may charge a fee for a property that the tenant agrees to let, they cannot charge for providing leads, or information about available apartments. However, depending on the agent, they may request that other fees are mandatory so it is best to get this information upfront before entering a business relationship. Prospective tenants should confirm that the letting agent belongs to any of the following – the Royal Institute of Chartered Surveyors, Association of Residential Letting Agents, or the National Association of Real Estate Agents.

Letting Rights and Responsibilities

Generally, landlords are responsible for the following –

  • Ensuring that the property is habitable
  • Effectiveness of gas and electrical appliances
  • Fire safety
  • HMO licensing (where applicable)
  • Energy Performance Certificates

It is the tenants’ responsibility to –

  • Pay rent in a timely fashion
  • Pay other expenses like the water, sewage and applicable bills
  • Pay council tax

The tenant also has the right to quiet while in their home. If the building is sold to another party, they can still occupy the property.

Leaving the Property

Under these circumstances can a landlord request that a tenant vacate a property –

  • At the end of a shorthold lease, with two months’ notice given
  • The landlord has a possession order by the court

In the case of an assured tenancy, there are other reasons for the landlord to take possession that may apply.

Rent Increase Basics

Before signing a lease agreement, both the tenant and landlord should agree to the amount that is to be paid by a certain time. At the end of a fixed-term tenancy or specified intervals (such as annually), the rent is reviewed. The lease agreement should also state how often the rent is reviewed.

The rates can only increase by the amount stated in the lease agreement if this is what the tenant agrees to.

What if Rent Reviews are Not Stated in the Agreement?

In the case of a fixed-term agreement, rent can increase at the end of the six months if this is what the tenant agrees on.

The landlord may increase the rent amount at any time in an assured tenancy. They may specify in the agreement that the rent may increase on the tenants’ anniversary on a yearly basis.

For the fixed-term tenancies that convert into assured status, the same rules may apply if this is what the tenant should agree to.

Rent Increase Disputes

If a tenant disagrees with a rent increase, they may present their case to the rent assessment committee, who will review and settle on a fair amount after the review of relevant documents. Either the tenant or landlord may request a formal hearing when a dispute arises.

Joint Tenancy and Sublets

Can There Be More Than One Name On A Lease?

In most cases, this is not a problem. In fact, it is encouraged for all that will reside on a property because they will be entitled to certain rights. However, all parties on a lease agreement will be responsible for paying rent and agreeing to the terms stated by the landlord.

What Happens in the Case of Death?

If one of the tenants should die, then the remaining tenant(s) have a right to remain on the property. Should the named tenant pass away, the unnamed occupant may have rights to remain, depending on the terms stated by the landlord.

Subletting Basics

In the case of either an assured or fixed-term tenancy, it cannot be sub-let to another party without the written consent of the landlord. The only exception may be if a premium was paid but once again, this is only with the landlord’s consent.

Eviction Basics

Assured and shorthold tenants may only be evicted with a court order. Landlords who attempt to do this outside the justice system are committing a criminal offense. This includes tactics such as verbal harassment, violence, or withholding utilities. Any tenant who is experiencing this from their landlord should report him or her to the local authorities.

About the Author

My name is Sandra Hamilton  and have had many years experience of blogging on a wide range of topics including landlord insurance, indemnity insurance, Business Insurance and liability. To read more about these topics then please do visit Lifesure at http://www.lifesure.co.uk/landlord-insurance/.

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