Assured Shorthold Tenancy (AST)
The Assured Shorthold Tenancy (AST) is the prevailing tenancy type in the UK, offering flexibility for both landlords and tenants. Typically, ASTs have a fixed term of 6 or 12 months but can be renewed upon agreement.
It provides tenants with essential protections while allowing landlords to regain possession after the fixed term with proper notice. Most tenancies automatically fall under ASTs, provided they meet certain conditions, including being for private accommodation, starting after 1989, and serving as the tenant’s main residence.
It is important to note that certain exceptions exist where ASTs cannot be used, such as for high-rent properties, holiday lets, or situations involving extremely low or no rent.
Assured Tenancy
An Assured Tenancy offers tenants greater security compared to an Assured Shorthold Tenancy (AST). Unlike ASTs with fixed terms, assured tenancies can last for any duration, providing tenants with long-term stability.
Key features of an Assured Tenancy include:
- Enhanced Security: Tenants have stronger protection against eviction, and landlords must present a valid legal reason to regain possession.
- Flexible Duration: Tenancies can continue indefinitely, offering stability for tenants.
- Ending the Tenancy: Specific procedures and extended notice periods apply for landlords and tenants to terminate an assured tenancy.
While less common today, assured tenancies were frequently used in the past, particularly for tenancies starting between 1989 and 1997. They continue to be prevalent in the social housing sector, with housing associations often utilising this type of tenancy.
Regulated Tenancy
Regulated tenancy is an older form of tenancy that is rarely used today but still applies to some existing properties. It is predominantly found in tenancies established before 1989 and typically offers indefinite tenancy duration, ensuring long-term stability for tenants.
The Valuation Office Agency controls and sets rent levels, ensuring affordability. Landlords can only regain possession under specific circumstances with substantial cause. Termination is subject to strict legal requirements, offering tenants strong protection.
While regulated tenancies are uncommon for new agreements, they remain relevant for existing tenancies established before the introduction of newer tenancy types. If you are dealing with an older property, it is essential to verify the tenancy type to ensure compliance with the specific regulations governing regulated tenancies.
Fixed-Term Tenancy
A Fixed-Term Tenancy is a tenancy agreement with a predetermined end date. It provides both landlords and tenants with clarity regarding the duration of the tenancy. The fixed period is mutually agreed upon and can range from six months to several years.
Fixed-term tenancies offer a balance between flexibility and security. While tenants cannot typically leave early without a break clause or landlord consent, landlords also benefit from knowing the tenancy’s duration, aiding in future planning. Reviewing the agreement carefully to understand the specific terms and conditions related to early termination, renewal, or extension is essential.
Periodic Tenancy
A periodic tenancy is a flexible tenancy agreement that continues on a rolling basis, typically month-to-month or week-to-week until either party provides notice to terminate. It often arises when a fixed-term tenancy expires without a new agreement in place.
Periodic tenancies are useful when flexibility is desired or when transitioning between fixed-term agreements. However, shorter notice periods can lead to less predictability than fixed-term tenancies. Understanding the specific notice requirements and any contractual provisions related to periodic tenancies is crucial to ensuring a smooth and compliant termination process.
Company Tenancy
A Company Tenancy is a tenancy agreement in which the tenant is a registered company rather than an individual. Similar to other tenancy types, these tenancies can be either fixed-term or periodic.
Key Features:
- Corporate Tenant: As a legal entity, the company assumes responsibility for rent payments and adherence to the lease terms.
- Negotiated Terms: Lease terms are typically negotiated directly between the landlord and the company, allowing for greater flexibility than standard tenancy agreements.
- Different Regulations: Company tenancies are not governed by the same rules as Assured Shorthold Tenancies, particularly regarding deposit protection and eviction procedures.
- Termination: Ending a company tenancy usually involves providing a ‘notice to quit’ rather than serving a Section 21 or Section 8 notice.
Company tenancies are common when renting properties to businesses for office space, retail units, or other commercial purposes. It is important to understand the specific legal framework surrounding company tenancies, as they differ from individual tenancy agreements. Seeking professional advice is recommended when drafting or terminating a company tenancy to ensure compliance and protect the interests of both parties involved.
