Law guide: Property

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Contents

The main types of tenancy you can set up are an:

  • assured tenancy; or
  • assured shorthold tenancy.

The main difference between them relates to security of tenure – i.e. how easily a tenant can be evicted from a property. A landlord can regain possession of their property far more easily with an assured shorthold tenancy.

In certain circumstances, a tenancy can't be an assured shorthold or an assured tenancy and is, instead, a regulated tenancy (with its own provisions about the rights of landlords and tenants).

Assured tenancies

Any residential tenancy entered into on or after 15 January 1989 for premises let as a separate dwelling will be an assured tenancy, as long as the:

  • Tenant is an individual (or each joint tenant is an individual)
  • Tenant occupies the premises as their main or only home
  • Tenancy doesn't fall within one of the exceptions below

Exceptions

Tenancies that aren't assured tenancies (including assured shorthold tenancies) are outside the scope of this guide.

These are the exceptions where a tenancy is not an assured tenancy:

  • High value tenancies
  • Low value tenancies
  • Business tenancies
  • Tenancies where the premises are licensed for the supply of alcohol for consumption on the premises
  • Tenancies where agricultural land of more than 2 acres is let with the dwelling-house
  • Tenancies of agricultural holdings or farm business tenancies
  • Lettings to students by educational institutions and other specified persons
  • Holiday lettings
  • Lettings by a resident landlord where the landlord and the tenant share the same flat or house
  • Lettings by a resident landlord where the landlord and the tenant each has a flat in a building that has been converted into flats (but not where they have separate flats in a purpose-built block of flats)
  • Crown tenancies
  • Lettings by specified public bodies, including local authorities
  • Certain lettings of social housing to asylum seekers, displaced persons or tenants who have been evicted on anti-social behaviour or nuisance grounds

Assured shorthold tenancies (ASTs)

An assured tenancy made on or after 28 February 1997 will automatically be an assured shorthold tenancy (AST) unless it falls within one of the exceptions below. (A tenancy starting between 15 January 1989 and 28 February 1997 was an AST only if this was stated in the tenancy agreement or in a written (not oral) notice served by the landlord called a 'section 20 notice'.)

Exceptions

These are the exceptions where an assured tenancy made on or after 28 February 1997 is not an AST:

  • The tenancy agreement states that the tenancy is not an AST
  • Before the tenancy started, the landlord served a notice on the tenant stating that the tenancy wouldn't be an AST
  • After the tenancy started, the landlord served a notice on the tenant stating that the tenancy would no longer be an AST
  • The tenancy became an assured tenancy on the ending of a secure tenancy
  • The tenancy arose when a fixed term assured tenancy rolled over into an assured periodic tenancy
  • The tenancy arose by succession (for example, where the current tenant became the tenant under the will of the original tenant)
  • The tenancy arose by virtue of Schedule 10 to the Local Government and Housing Act 1989 (security of tenure on ending of long residential tenancies)
  • The tenant is an agricultural worker
  • The tenancy is a new tenancy granted to a person who was an assured tenant (but not an assured shorthold tenant) of the same landlord immediately before the new tenancy

This last exception provided some protection for tenants who had an existing assured tenancy when ASTs were introduced. It prevents the landlord of a pre-existing assured tenancy simply turning it into an AST by ending the old assured tenancy and having the same tenant enter into an AST agreement instead. This exception doesn't apply if the tenant had served a notice on the landlord before the new tenancy started stating it was to be an AST.

Fixed term and periodic tenancies

You can set up any assured shorthold tenancy or assured tenancy as:

  • Fixed term, meaning that it runs for a specified period (for example, 12 months)
  • Periodic, meaning that it runs from one rental period to the next (such as month-to-month or quarter-to-quarter) depending on when the rent is paid

A tenancy that's a periodic tenancy by agreement with the tenant is called a contractual periodic tenancy.

If you start with a fixed-term tenancy and allow the tenant to stay in the property without a new agreement at the end of the fixed term, the tenancy will automatically become what's called a statutory periodic tenancy.

Deciding which type of tenancy to set up

You're recommended to use an assured shorthold tenancy if you may want to regain possession of the property after a period of time. If you have a mortgage on the property, the terms of the loan may require you to use this type of tenancy.

You could use an assured tenancy if you're thinking of letting the property indefinitely. You should, however, take legal advice before making such a decision, as you'll only be able to regain possession if certain grounds for possession apply.

If you're sure you want to set up an assured tenancy (and not an assured shorthold tenancy), all you need to do is:

  • give the tenant a written notice before the tenancy starts stating that it isn't an assured shorthold tenancy; or
  • include a statement in the tenancy agreement to this effect.

Right to possession

For more on the grounds for possession, see Recovering possession

Fixed-term tenancies

You can only seek possession during the fixed term of a fixed-term tenancy if certain grounds for possession apply and the tenancy agreement states that the tenancy can be ended on any of these grounds (such as rent arrears or nuisance behaviour by the tenant), or if there is a break clause (a term of the agreement that allows you to end it during the fixed term).

Periodic tenancies – assured tenancy

You can only seek possession if certain grounds for possession apply.

Periodic tenancies – assured shorthold tenancy

A periodic tenancy must normally run for a minimum period of 6 months. You can seek possession during the first 6 months only if certain grounds for possession apply and the tenancy agreement states that the tenancy can be ended on any of these grounds (such as rent arrears or nuisance behaviour by the tenant).

You're free to seek possession after the minimum 6-month period as long as you've given the tenant a valid written notice (giving at least 2 months' notice of the intended possession date) and met certain other requirements. For more about seeking possession of the property, see Recovering possession.