What is an assured shorthold tenancy?
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When renting a property in England and Wales, one term frequently arises; an Assured Shorthold Tenancy or AST.
Introduced under the Housing Act 1988, the Assured Shorthold Tenancy has become the default form of tenancy for most private residential rentals in England and Wales.
It provides a structured framework that governs and regulates the relationship between landlords and tenants, offering both parties a balance of security and flexibility.
Understanding an AST's intricacies is essential for landlords and tenants as it determines their rights and obligations throughout the tenancy period.
From the duration of the tenancy and rent payment terms to the process of regaining possession of the property, an Assured Shorthold Tenancy encompasses various crucial aspects that shape the rental experience.
What is an Assured Shorthold Tenancy?
An Assured Shorthold Tenancy (AST) is a tenancy agreement commonly used in England and Wales. It has been the default form of tenancy for most private residential rentals since the introduction of the Housing Act 1988.
What is the AST criteria?
The Assured Shorthold Tenancy will apply to most private tenants in the United Kingdom as long as:
The original tenancy started on or after 28th February 1997.
The tenant does not live with the landlord.
The tenant's rent is less than £100,000 a year.
The tenant's rent is more than £1,000 a year in London or £250 a year outside London.
What are the key features of an Assured Shorthold Tenancy agreement?
ASTs are the most common type of tenancy agreement in the UK, and the tenant can be evicted from the property without reasonable cause. Here are some of the other key features of an Assured Shorthold Tenancy:
1. Fixed term
An AST is usually a fixed term that lasts six months or one year. During this period, both the tenant and landlord have agreed upon the duration of the tenancy.
2. Minimum notice period
The tenant is entitled to a minimum notice period before the landlord can regain possession of the property. Tenants are also expected to give the landlord notice before vacating the property. The notice period is usually two months.
3. Security of tenure
The tenant can live in the property for the agreed-upon duration, provided they fulfil their obligations under the tenancy agreement.
This means that the landlord cannot evict the tenant without a legally valid reason, such as the tenant failing to pay rent or breaching other terms of the agreement.
The tenant can only be evicted with a Section 8 or Section 21 notice.
4. Rent increase
The landlord can increase the rent during the tenancy, but they must follow specific legal procedures such as giving notice and adhering to any restrictions outlined in the tenancy agreement.
5. Deposit protection
Landlords must protect the tenant's deposit in a government-approved tenancy deposit scheme. This helps ensure that the deposit is returned to the tenant at the end of the tenancy, subject to any deductions for damages or unpaid rent.
6. Repossession
At the end of the fixed term, the landlord can regain possession of the property, provided they follow the proper legal process and give the tenant appropriate notice. If the tenant remains in the property after the fixed term expires, the tenancy may automatically become a periodic tenancy (a month-to-month arrangement).
What does an Assured Shorthold Tenancy agreement look like?
Assured Shorthold Tenancy Agreements can either be fixed term, usually 6 or 12 months or can be periodic, usually rolling weekly or monthly.
Some contracts between landlords and tenants can have a break clause which allows the tenant to end the agreement early with notice.
The AST will include the following:
Start date of the tenancy agreement.
Rent payable, rent due date, deposit amount and protection scheme.
Any rent review clause.
Address of the rented property.
Name and address of all parties (tenants, landlords and letting agents).
The length of any fixed-term agreement.
Bills the tenant is responsible for.
Any party involved in renting a property should receive a copy of the AST to sign. The tenant should ensure that they read all terms before agreeing to them and keep a copy of the agreement safe in case they need to refer to it during the tenancy.
What is the Written Statement of Terms?
If the landlord does not provide the tenant with a contract, the tenant can request a written statement of essential terms to the agreement. The landlord must provide the tenant with the following information in writing:
Start and end date.
Rent cost & date to pay rate.
When is a tenancy not an Assured Shorthold Tenancy?
A tenancy is an AST when...
The tenant is renting from a landlord or housing association.
The tenancy started after 15th January 1989.
The Property is the tenants primary or only residence.
The landlord does not live in the property.
A tenancy is NOT an AST when...
The tenancy started before 15th January 1989.
The rent is more than £100,000 a year.
The rent is less than £250 yearly or £1000 in London.
The tenancy is for a business or licence premises.
The property is a holiday let.
The landlord is a local council.
What are the common clauses in an Assured Shorthold Tenancy agreement?
If a tenant breaks any terms or clauses within an agreement, then the landlord can use this as grounds for eviction using a Section 21 or Section 8 notice:
Rent review
When the fixed term ends, the landlord can review the amount of rent a tenant pays and increase it if they have sound reasoning.
The landlord must ensure this is in agreement and notify the tenant towards the end of the fixed term to outline any changes accordingly. A landlord cannot increase the rent during the fixed period.
Subletting
If the tenant wants to sublet the property, they must receive consent from the landlord. The landlord must include a clause in the agreement if they wish the tenant to refrain from subletting the property.
Pets
The AST will include whether a landlord will allow the tenant to have a pet on the property.
Any landlord that does allow pets cannot request a higher deposit or a professional cleaning service (at the end of the tenancy), but they can charge a higher rent that must be defined in the tenancy agreement.
Decorating
Landlords may include clauses which state that a tenant is not allowed to alter the property in any way or put holes in the walls without the landlord's permission, including adding picture frames or painting the walls.
Smoking
Most Assured Shorthold Tenancy Agreements will include a clause stating tenants cannot smoke inside the property.
The garden and shared areas
Most ASTs will include a clause requesting that the tenants keep any gardens or shared areas in reasonable condition, including cutting grass and trimming hedges.
Smoke alarms/Carbon Monoxide detectors
Landlords, by law, must test the smoke or carbon monoxide detectors on the first day of the tenancy. The AST will then define that the tenant must check the alarms regularly and replace the batteries.
It is important to note that many of these clauses are set to change under the Renters Reform Bill.
Are there any illegal clauses in an Assured Shorthold Tenancy agreement?
The tenancy agreement must not discriminate against the tenant or landlord; for example, if the tenant is disabled, the landlord should adapt the tenancy to suit their needs.
If a clause in the tenancy agreement goes against any laws, then the landlord cannot enforce the clause.
How do you change an AST?
If a tenant wishes to make amendments to the Assured Shorthold Tenancy Agreement during the fixed-term tenancy, they must seek the landlord's consent.
The changes to an AST are known as a contract variation, and a fee may be involved in amending the agreement.
How do you end an AST early?
If a tenant wishes to end an Assured Shorthold Tenancy Agreement early, then there may be a break clause included, which will allow the tenant to leave free of charge up to a defined date.
The tenancy agreement will also outline the notice period the tenant must give the landlord.
If the tenant wishes to terminate the tenancy before that point, then the tenant may be liable for the landlord's costs in re-letting the property and the rent until the start date of the replacement tenant.
The costs cannot exceed the maximum amount of rent outstanding on the tenancy agreement.
What are a landlord's responsibilities for an Assured Shorthold Tenancy?
The Assured Shorthold Tenancy Agreement should define the landlord's responsibilities, including giving the tenant at least 24 hours notice before a visit occurs, ensuring the property complies with all health and safety regulations and describing what parts of a property must be repaired.
Some other key responsibilities of landlords are:
Providing a safe and habitable property
Landlords are responsible for ensuring that the property is safe, in good condition and meets all relevant health and safety regulations. This includes maintaining the structure, heating, plumbing and electrical systems.
Protecting the tenants deposit
The landlord must protect the tenant's deposit within a government-approved tenancy deposit scheme within 30 days of receiving it.
The landlord must also inform the tenant about the scheme, including how they can get their deposit back at the end of the tenancy.
Providing rent information
The landlord must provide the tenant with written information regarding the amount of rent, how it should be paid and the frequency of rent reviews.
Issuing a written tenancy agreement
The landlord should ensure that the tenant has written a tenancy agreement that outlines the tenancy terms and conditions.
This agreement should cover essential details such as the duration of the tenancy, rent payment terms and any special classes or restrictions.
Conducting repairs and maintenance
The landlord is responsible for conducting necessary repairs and maintenance on the property, ensuring it remains in a good state of repair throughout the tenancy.
This includes addressing any issues that may arise during the tenancy promptly.
Ensuring gas and electrical safety
The landlord must arrange for an annual gas safety check by a Gas Safe registered engineer and provide the tenant with a copy of the gas safety certificate.
Electrical installations and appliances should be safe and regularly maintained, although there is no legal requirement for an annual electrical safety check.
Providing required documents
The landlord should provide the tenant with an Energy Performance Certificate (EPC) for the property and a valid gas safety certificate before they move into the property.
Respecting tenant privacy
The landlord has the right to access the property for specific purposes but must also respect the tenant's right to privacy.
The landlord should provide reasonable notice and obtain their consent before entering the property, except in case of emergencies.
Dealing with tenant complaints and repair requests
The landlord should address any complaints or repair requests from the tenant promptly.
Maintaining good communication and resolving issues promptly is essential to ensure a positive tenancy experience.
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