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What You Should Know About an Assured Shorthold Tenancy Agreement!

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If you’re in the renting business in the UK various tenancy agreements are available when renting. As a landlord, you need to decide which one is right for you. The most common type of tenancy agreement and the one that ranks above the rest – in the UK is an Assured Shorthold Tenancy (AST). The majority of new tenancies are automatically this type, so you must understand them before you sign on that dotted line.

What is Assured Shorthold Tenancy?

An ‘Assured shorthold tenancy agreement’ (AST) allows a landlord to let out a property to a tenant while retaining the right to repossess the property at the end of the term of the tenancy. It is regarded as a short-term tenancy; the tenancy usually lasts for a minimum of twelve months. However, the landlord will need to give the tenant at least two months’ notice of any reoccupation.

This agreement will outline how much rent you pay, who is responsible for any repairs or damages, and exactly how long your tenancy will be. From the start of this contract, the tenant is committed to paying the agreed instalments on time.

A tenancy can be an AST if all of the following apply |

  • you’re a private landlord or housing association
  • the tenancy started on or after 15 January 1989
  • the property is your tenants’ main accommodation
  • you do not live on the property

A tenancy cannot be an AST if |

  • it began or was agreed before 15 January 1989
  • the rent is more than £100,000 a year
  • the rent is less than £250 a year (less than £1,000 in London)
  • it’s a business tenancy or tenancy of licensed premises
  • it’s a holiday let
  • the landlord is a local council

The contract

ASTs normally last six to twelve months. Bef]ore the lease begins, the tenant must be given the contract to sign. The tenancy agreement specifies the amount of rent due, who is liable for repairs, and the length of the tenancy. Although most repairs, such as those to the roof, walls, windows, doors, wiring, and plumbing, are your responsibility, the contract should specify who is responsible for additional tasks, such as garden maintenance. An AST requires the tenant to maintain your property and do day-to-day duties such as changing light bulbs.

Tenancy deposits

You should demand a deposit from the tenant at the start of an AST in case the property is damaged, or the rent is not paid when they move out. One of three government-approved tenancy deposit protection plans must be used to safeguard the deposit.

At the end of the tenancy, the deposit should be repaid. If the tenant has caused damage or is in rent arrears throughout the tenancy, you can make reasonable deductions.

Inventories

For any new tenancy, you should always create an inventory that includes a full description of the property’s condition and furnishings, as well as photographs. Before moving in, the tenant must agree to the terms of the lease and sign it. At the end of the tenancy, inventories will assist you in resolving tenancy deposit disputes.

Rent rises

Unless the contract specifies when it can be raised, you cannot increase the rent price indicated in the tenancy agreement during the fixed term of an AST. You can raise the rent once the fixed time expires.

Repairs

If your tenant demands repairs or you uncover damage during routine inspections, you must either execute the job yourself or hire a competent tradesperson to do it for you. Before you enter the property, remember to give your tenants at least 24 hours’ notice.

In addition, you are required by law to do a gas safety inspection once a year. You must provide a copy of the gas safety certificate to your tenants after this is completed.

Renewal

Your tenant has a number of options when the AST ends. They can |

Ask for a new fixed-term contract | they should be aware of any renewal fees they’d have to pay, and any rent increase you decide to implement

Leave at the end of the fixed term | you may decide to request notice before they leave

Stay beyond the fixed term, even if they don’t sign a new contract | the agreement becomes periodic and rolls from month to month at the same rent

Leave before the end of the fixed term | the contract may include a break clause that gives them this option

Eviction

When a tenant rents under an AST, they are protected against eviction. They must be given advance notice of their departure, and this notice must be properly served.

Landlords must acquire a court order and follow a series of procedures in order to evict their tenants. The most common types of eviction notices are section 21 and section 8 notices. You don’t have to mention a reason for eviction if you utilise section 21, although section 8 notifications do.

If you rent your property on an AST, which you most likely do, you must understand the rules surrounding this type of tenancy. Don’t be caught out when letting your property!

Why opt for an AST?

When it comes to tenancy agreements – besides ASTs – there are the following |

  • Non-assured shorthold tenancies (landlords do not have to give the notice to end the tenancy)
  • Excluded tenancies (for landlords that live with their tenants e.g., lodgers)
  • Assured tenancies (mainly used in the past and for housing associations)
  • Regulated tenancies (used before 1989)
  • Company lets (when a property is rented to a company and not an individual tenant)

Landlord’s responsibilities for an AST

The AST should spell out the landlord’s legal obligations as well as any additional responsibilities they may want to assume in relation to the property. These will include providing you with at least 24 hours’ notice before a visit, ensuring the property complies with all health and safety requirements, detailing what elements of the property they will repair or replace, and any other legal obligations they may have.

Summing-up

Shergroup has long been associated with the landlord’s community in the UK. We’ve been offering solutions related to property, evictions, enforcement, security to the landowners and the property managers for a long time now.

When it comes to tenancy agreements, we’d advise the landlords to ensure that they have a written and signed the AST agreement to make life easier for them and their tenants. A written agreement should clearly outline the terms and conditions of the contract for both sides. If a dispute should go before a court, the judge will want to read the AST.

Another important reason for having a written agreement is the option to start accelerated possession proceedings if a landlord wants to evict the tenant. Accelerated possession lets a landlord repossess property without a court hearing if the tenant fails to leave by the date indicated in a Section 21 notice to quit.

We hope this has helped to clear up any tenancy-agreement worries you might have had. If you’re still a little bit wary of renting for the first time, contact Shergroup.

We will guide you through the pitfalls of negotiating an AST and help you to protect your position while setting out both your and your tenant’s rights and obligations.

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Last updated | 19 July 2023

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