Landlords - Housing Acts and Types of Tenancies

When a property is let, an agreement is normally entered into between the Landlord (the person who owns the property) and the Tenant (the person renting the property). This is the Tenancy Agreement.

Legally, a Tenancy Agreement for a term of three years or less can be created in writing or orally. A tenancy for a fixed term of three years or greater should be created by Deed. By using our services, our experienced staff will explain all relevant tenancy types to you and ensure that the correct and relevant tenancy agreement is created. Our tenancy agreements have been created by The Letting Centre and are Trading Standards friendly.

The Housing Act 1988, enacted on the 15th January 1989, introduced Assured Tenancies whereby two types of tenancy could be created:

An Assured Tenancy - This would be suitable where the intention is to give complete security of tenure to the tenant, but with grounds for possession for the Landlord if certain criteria is met

An Assured Shorthold Tenancy - This is the main type of agreement entered into with private accommodation and is intended to give Landlords mandatory possession, through the court, at the end of the fixed term. The main features of such a tenancy are as follows:

• The tenant is assured the right to stay in the property for at least 6 months, unless they break the terms of the agreement in which case they may have to leave earlier.
• The tenant is bound to the full term of the tenancy, unless there is a break clause.
• The Landlord must give at least two months notice to bring the tenancy to an end and cannot do so before the term of the tenancy is two months or less away. For example, in the case of a six month tenancy, the Landlord cannot give notice until after the end of the fourth month.

In order for either of the above tenancies to be created under the Housing Act 1988, a number of factors must be established, the main ones being:

1. The Tenant(s) must be an individual
2. The Tenant, or in the case of joint tenants, at least one of them, must occupy the property as their main home
3. The annual rent must not exceed £25,000 but must exceed:
   I. £1000 per year if the property is in Greater London, and
   II. £250.00 per year if the property is elsewhere
   and the figure must represent pure rent with no services included.
4. The Landlord must not enjoy resident landlord status, i.e. the landlord must not be living in part of the property which, when constructed was constructed as one property but has since been converted, all of which are owned by the Landlord. It does not, however, encompass properties which have been extended or had an annexe added.

Other exclusions can be found in Schedule 1 of the Housing Act 1988, for example where the property has more than two acres of land.

If you are unable to establish any one of the above facts, you can not create an Assured or Assured Shorthold Tenancy. The Tenancy would then automatically be a Non-Housing Act Tenancy.

Non-Housing Act Tenancy - This tenancy is simply a contract between the parties and the content of the contract will apply. In this type of tenancy the tenant has less protection that with any other type. These tenancies are most commonly used in company lets.

These tenancies generally expire at the end of the fixed term and no notice to terminate need be served. It is usual, however, to notify the tenant either one or two months prior to the end of the tenancy if the tenancy is not be renewed, out of courtesy and 'reasonableness'.

If the fixed term of the tenancy expires and the tenant continues a tenancy, formal notice in the form of a prescribed notice to quit is required an minimum of one month's notice would be required.

Further information on terms of business, services, legislation and charges are detailed in our Fees and Terms of Business. Please download a copy now or request a brochure via email.