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May 10, 2017

AN ASSURED SHORTHOLD TENANCY – A Guide

An assured shorthold tenancy, also known as an AST,is the most common form of private tenancy within England and Wales and was introduced by the Housing Act 1988.The essential difference between an assured tenancy and AST is that there is no real security of tenure for assured shorthold tenants.

Section 21 Notice

A crucial component of an AST is that it enables a landlord to obtain mandatory possession without having to establish any grounds for possession. He merely has to serve a section 21 notice of the Housing Act 1988 in the correct form and without having to establish any fault by the tenant.

A mandatory order for possession can be obtained after the initial 6 months of the tenancy for a periodic tenancy or at the end of a fixedterm tenancy, on condition the landlord has not granted a new fixed term that is still in existence. The notice must be in writing and does not have to follow a prescribed form.

Where the tenancy started off as a fixed term tenancy the notice is to be not less than two months and can be given before the expiry of the fixed term. Where the tenancy has always been periodic the notice must require possession after a date which is the last day of a period of the tenancy and the possession date cannot be earlier than two months after the date the notice was given.

The landlord must obtain a court order to lawfully evict a tenant if the tenant has not left the property by the end of the section 21 notice period.

Originally, the Housing Act 1988 required the landlord to serve a notice in a prescribed form warning the tenant that the tenancy would be an AST. However many landlords failed to complete the form correctly with the result that they created full assured tenancies. Effective from the 28thFebruary 1997, a landlord no longer has to serve the prior notice and subject to exceptions, all assured tenancies granted on or after this date are deemed to be shorthold tenancies.Where a series of ASTs’ have been granted by the same landlord to the same tenant and the first tenancy was granted before 28 February 1997, it will still be necessary for the landlord to prove that the correct notice was served. If not, the first tenancy will have been a full assured tenancy as will all the subsequent tenancies.

 

The Requirements

The tenancy must satisfy the following requirements to be an AST:

  • The tenancy started on or after 15 January 1989
  • The landlord is a private landlord or a housing association
  • The property being let is the tenant’s primary accommodation
  • The landlord does not live in the property

A tenancy cannot be an AST:

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

6 Month Minimum Term

An AST has a minimum tenancy length of 6 months. During this time the tenant cannot be evicted under a section 21 notice. However a tenant may be evicted if in breach of fundamental terms of the tenancy. For example the tenant has 8 weeks or 2 months rental arrears.

FixedTerm/Periodic Tenancies:

An AST can either be a fixed term or periodic tenancy.

A fixed term tenancy has a definite commencement date and expiry date for the tenancy. Most ASTs’ are for a fixed term of six months or a year. However a longer periodcan be agreed between the parties.  The tenancy will usually become a statutory periodic tenancy (s.5(2) HA 1988) if there is no renewal of the tenancy at the end of the fixed term and the tenant continues to occupy the property.

A periodic tenancy can include varioustime frame options based upon the rental payment period. For example week to week, month to month, quarter to quarter. Periodic tenancies can run indefinitely, or until either the tenant gives notice to quit or the landlord serves a notice seeking possession on the tenant.

Written Agreement

Landlords should provide tenants with a written agreement setting out the dates of the tenancy as well as the rent and other obligations of the parties. The tenant is entitled to receive a written agreement by law if requested of the landlord (or their agent) within 28 days of the start of the tenancy. The Housing Acts (1988, 1996, 2004) provides protection to tenants without a written agreement where a legal tenancy still exists where there is no written agreement on condition that the tenancy is for less than 3 years.

Tenancy Deposit Schemes

Effective from 6 April 2007 and subject to amendments, sections 212-215 of the Housing Act 2004 requires all landlords of an AST to:

  1. Comply with the ‘initial requirements’ of the scheme by protecting any tenancy deposit held by the landlord in an authorised tenancy deposit scheme
  2. Provide the ‘prescribed information’ of the scheme to the tenant

The landlord is required to protect the deposit and provide the ‘prescribed information’ within 30 days of receiving the deposit. A landlord failing to comply with either of these requirements can face possible sanctions of a penalty of up to three times the deposit and he cannot rely on the service of a section 21 notice to obtain possession of the property until either:

  1. the landlord returns the deposit to the tenant in full or with agreed deductions, or
  2. the landlord’s non-protection of the deposit has been dealt with by the county court

The tenant may commence a Part 8 legal claim against the landlord for his breach of section 213 of the Housing Act 2004 via the county court. The Court must order the landlord to pay the applicant between one and three times the amount of the deposit, if it finds that the landlord has not complied with the’ initial requirements’ or provided the tenant or person paying the deposit the ‘prescribed information’.

Vacant Possession

The court cannot entertain proceedings for possession of a dwellinghouse let under an AST unless the landlord has served a notice on the tenant. There are three stages involved for a landlord to obtain possession:

  1. Serving a notice

This can be a section 21 Notice or other mandatory grounds specified in Schedule 2 of the Housing Act 1988

  1. 1stApplication to the county court

The court nearest to the property for a Possession Order

  1. 2ndApplication to the county court

For court bailiff to evict the tenant