Assured shorthold tenancy tips

The majority of residential tenancies in England and Wales are assured shorthold tenancies.  They usually commence with an agreed fixed-term (6 and 12 months are the most common choices) during which both the tenant and the landlord are contractually committed. The tenant has to pay the agreed rent on time and the landlord provide the tenant with exclusive possession and undisturbed enjoyment. At the end of the fixed-term contract the tenancy can either be renewed for a new fixed-term or it will automatically convert into periodic tenancy. Periodic tenancy depends on the original rent payment period (i.e. if the rent was payable monthly the periodic tenancy will run from month to month until terminated by either party).

What is an assured shorthold tenancy?

Assured shorthold tenancy provides the tenant with more certainty as to the tenure. During the ‘assured‘ period the landlord’s termination rights are limited and normally the landlord will not be allowed to seek repossession.

What are the termination rights?

Assured tenancy can normally be terminated by the landlord serving a section 21 notice. The notice itself however needs a minimum of 2 months. The notice under section 21 can be served at any time. In practice however the court will not support the claim and order the tenant to remove his possessions if the notice is served earlier than 6 months from the beginning of the first tenancy under which the premises have been occupied. If you need advice on making a possession claim go here on our main site,

How long should I offer the tenancy for?

Prior to February 1997 all assured shorthold tenancies had to had been entered into for at least 6 months. Perhaps for this reason it has become customary and most of tenancies in England and Wales are for 6 months. This is normally feasible for tenants and useful for landlords as it allows them to rely on section 21 notice. From February 1997, there are however no specific legal requirements as to the minimum period of tenancy or assured shorthold tenancy. In practice letting property out for less than 6 months will make it impossible to rely on section 21 notice to obtain quick repossession. For this reason some landlords decide to take larger rental deposit to cover any possible defaults.

Advantages of long term tenancies

According to statistical data the average length of tenancy is 9 months. Opting for a longer tenancy can also have other beneficial aspects to it. If you use an agent you will be likely to save on their ‘tenancy renewal‘ commission. If you sort your rental affairs all by yourself it saves you work both in terms of maintenance and sorting out the documentation.

Furthermore, in times of weak property rental market securing a longer tenancy can also be beneficial as it means your income will be less affected by the unfavourable conditions. On the other hand, in favourable conditions with rising rental property prices being tied into an agreement will result in you being unable to get better deal for the property.

Importantly, before deciding to offer a long term tenancy it is prudent to consider how well you know the tenant and what is the likely of his or her rental default or other problems. It may perhaps be best to offer initial 6 months tenancy (with section 21 notice served at the same time) and if everything goes well you can renew the agreement for longer.

Multiple Tenants

Lastly, when renting your property out to more than one private tenant you should ensure that all of the individuals sign the rental agreement and ensure that the agreement contains provisions for both joint and several liability. That way if one tenant absconds or makes damage to the property all the others will be jointly responsible.

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May 20, 2012