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Assured Shorthold Tenancy

What exactly is meant by Assured Shorthold Tenancy?

This refers to a form of tenancy, which involves a type of arrangement between a private residential landowner and his tenant who rents his property.

It’s worth mentioning that all the tenancies created on January 15, 1989 and after that, are automatically considered as Assured Shorthold Tenancies, provided no special notice is given to indicate otherwise. This means that even if there is no written agreement or oral contract between a tenant and landowner, the tenancy will be considered as Assured Shorthold Tenancy. As a result; both tenants and landlords are completely protected and secured by Housing Act 1996 and Housing Act 1988.

Requirements for obtain an Assured Shorthold Tenancy

There are actually many factors that are used to determine if a tenant or a landowner are eligible for Assured Shorthold Tenancy. If the agreement fulfils all the following criteria then it will certainly act as Assured Shorthold Tenancy.

  • If the annual rent of a tenant is less than £25,000.
  • Any tenant shifted to a new property on Feb 28, 1997 or after that.
  • If a tenant uses the services of a private landlord to rent a property
  • If a tenant has certain rights in the property for privacy, and landlord cannot make an entry into the property without going through a mutual agreement

A tenancy will NOT be considered an Assured Shorthold Tenancy under following conditions:

There are actually several factors that are used to determine if a tenant or a landowner are NOT eligible for Assured Shorthold Tenancy. If the agreement fulfils all the following criteria then the tenancy will not considered as Assured Shorthold Tenancy.

  • If the annual rent of a property is more than £50,000
  • If the rent of a property is very low, or property receives no rent at all.
  • If a property acts as a holiday home
  • If a property is rented out to a private limited company
  • If the government or crown owns the property
  • If a property is rented out with the agriculture land that is more than 2 acres, or the property comes under agricultural tenancy.

Housing Act 1988

The Housing Act 1988 essentially concerned itself with Private Rented Sector, and used to cover many of the UK legislation laws for this Sector.

The government has prepared these laws, by spending more than 250 hours, to make private renting sector much more efficient and fairer to the landlords. All the laws that got passed come under The Housing Act 1988 cover all the legal responsibilities and statutory rights for both tenants and landlords.

It’s quite common to see the conflicts between various clauses mentioned in the Tenancy Agreement and the statutory rights mentioned in the Housing Act. The main reason for this is that many notorious and novice landlords make several drastic modifications in these agreements without considering the statutory rights at all. If this type of case arises, the tenancy agreement is considered invalid, as the ruling law is the Housing act, and it cannot be overruled.

The Official Housing Act 1988 can be accessed online.

Since the time the Housing Act 1988 was introduced, many drastic revisions have been made to it; prominent revisions were added to the Housing Act 1996.

Housing Act 1996

The Housing Act 1996 consists of several revisions that were made to the Housing Act 1988.

Some drastic changes were introduced with the Housing Act 1996 that were applicable with effect from February 28, 1997.

You can access Official Housing Act 1996 online.

Tenancy Agreement Terms and Definitions

Assured Tenancy – This tenancy gives the right to tenants to remain in the rented property until the landlord approaches the court, and gives a valid reason to evict the tenants, for instance, damage to property etc.

Assured short-hold tenancy – This is essentially the most common type of tenancy in the UK. This is quite similar to an Assured tenancy, but the only exception is that it lasts for a fixed period of more than six months. This type of tenancy is very popular as it allows landlords a facility to easily give any notice to end any agreement.

Buy to Let (BTL) – This is more of an investment strategy, whereby individuals buy a residential property or home to let it for gaining profits.

Buy to share (BTS) – This is a practice whereby individuals buy a property or home with the purpose of renting out some portion of the property to financially help them in paying the mortgage.

Deposit – Deposit is a fixed amount of money generally taken by letting agents or landlords at the beginning of a tenancy period in order to cover future losses or expenses on the part of tenants, for instance, damage and rent arrears.

DSS: Claiming state benefit from housing benefit.

Guarantor – Individuals who provide the landowner a sort of warranty about the tenant.

House in Multiple Occupations (HMO) – These are the forms of accommodations that are shared by many people.

Inventory – A complete list of all the items present in the property, including their usage conditions.

Landlord – Refers to the individual who owns the property, or the one whom you pay your rent. This may also refer to the property free holder that provides you tenure for leasehold.

Live-in landlord – A property holder who lives in a property but rent out a portion of this property to tenants.

Live-out landlord – A type of landlord that doesn’t live in a property, which he rents out to his tenants.

Lodger – A type of tenant who rents a room in somebody else home, normally in a Live in landlord’s home.

Per Calendar Month (PCM) – This term used in relation to the time when to pay your monthly rents.

Sublet – This is an agreement whereby the existing tenant rents out a portion of the property to another.

Rent – Total amount of money charged monthly by a landowner to rent out his property

Tenancy – An act of occupancy when you officially become a tenant.

Tenancy Agreement: A type of Legal agreement between the tenant and landlord. This can be both verbal and written.

Tenancy Deposit Scheme – A scheme introduced by government in 2007 in order to safeguard the deposits given by tenants to the landlords.

Tenant – A tenant is someone who uses someone’s building to live, and pays a fixed monthly rent for doing so.

What is meant by a Tenancy Agreement?

Basically, a Tenancy Agreement is a contract that serves as an Assured Shorthold Tenancy between a Tenant and a Landlord, with all stipulated terms and conditions about their rental agreement.

There is no need to get a written Tenancy Agreement as long as fixed period tenancy is more than 3 years; in which case it can become Oral Tenancy Agreement. It is, however, strongly recommended that there should be a written agreement so that all terms and conditions can be clarified and used as a proof in case of any dispute.

There are many forms of Tenancy Agreements available, and all of them should consist of following aspects:

  • Dates: The exact date when was agreement was prepared
  • Landlord Details: It contains all the address and other details about the landlords.
  • Tenant Details: It contains all the address and other details about the Tenant(s).
  • Property Details: It contains all the address and other details about the property that is being used for renting purpose.
  • Term: The starting and ending date for tenancy. Sometimes, this is also called “fixed term”
  • Rent: This is referred to as the amount of rent to be paid by tenant to landlord. This may also contain the method and the exact date of payment of rent.
  • Deposit: This part contains the total amount of the deposit that need to be deposited, and what are the things that this deposit will actually cover.
  • Deposit Scheme: This part consists of Tenancy Deposit Scheme in which the deposit is usually secured.
  • Landlord’s Obligations: This usually contains the responsibilities and duties of the Landowners.
  • Tenant’s Obligations: This usually contains the responsibilities and duties of the Tenant towards his landlord and property.
  • Other Special Provisions: This usually contains other special provisions that are agreed upon between tenant and landlord, for instance pets, sub-letting, and smoking, etc.
  • Signatures: It’s mandatory to sign Tenancy Agreements by both the Tenant(s) and the Landlord(s).
  • Witnesses: Though it is not necessary legally to have any witness to sign the Agreement, but, it can be very helpful in cases where the signatures can be disputed by Tenant(s) or the Landlord(s).

The exact guidelines for what should be mentioned in a Tenancy Agreement can be found in the Housing Act 1988.

How to Obtain your Tenancy Agreement?

You can obtain a Tenancy agreement by using many sources, or even for free in many cases. However, it’s very crucial to obtain your copy from a trustworthy supplier with up-to-date and completely legal version. We are here to provide you Tenancy Agreements that are prepared by award winning and most reputable professional solicitors. We sell all our Tenancy Agreements at an unbelievably low price of £10.20. Contact us to Buy a Tenancy Agreement right now.

How to change the various Terms and conditions in a Tenancy Agreement

It’s a fact the various terms and conditions mentioned in a Tenancy Agreement can be effectively changed; however, it requires that both the tenant and the landlord must agree upon on these changes.

All the changes that are made by mutual agreement are recorded in a written document. This can be achieved by preparing an entirely new tenancy agreement, or just by making modifications in the existing agreement.

There can be number of reasons to make amendments to a Tenancy Agreement.Here are a few of the most important ones.

  • Making Changes in the rent amount e.g. rent increase or decrease.
  • Tenant has bought a pet. There can be new terms that need to be included in the agreement for including the liability of pet damage.
  • The tenant may want to transfer the tenancy to any other member of his household living with them for more than one year.
  • The tenant may decide to modify the tenancy type to a joint tenancy.

Changes can also be made verbally, but it is highly advisable to record everything in written. The reason being; confusion may crop up later on if there is no written record of the agreement. Therefore, it’s a safer practice to record everything in written.

Another important thing to notice is that all the amendments to Tenancy Agreement should be in accordance with Housing Act. There are statutory rights for both tenants and landlords that simply can’t be overwritten. In case of any conflict, the Housing Act will serve as the ruling law.

Discrimination in context to Tenancy Agreements

Tenants must not be discriminated by Landlords because any of the following reasons:

  • Sex / Gender based discrimination
  • Disability based  discrimination
  • Racial discrimination
  • Discrimination based on Beliefs or Religion

It is illegitimate for any landlord to do any act of discrimination against his tenants due to any of the above reasons. As a result, the following aspects of discrimination are completely against the law.

  • If a landlord Rents out a property to specific tenants by providing them worse terms and conditions than the other tenants.
  • If a landlord treats some of his tenants in a different way at the time of determining various policies about access to certain facilities like garden access and laundry.
  • Harassing or Evicting tenants because of gender disability, race, sexuality or even religion, among others.
  • If a landlord refuses to entertain reasonable requests from disabled persons; for instance, if he doesn’t allow a dog to reside with blind tenant in his property etc.

If the landlord lives in the same property as the tenant some of the above rules may not apply; however, the landowners are still prohibited to discriminate any of their tenants because of their race.

Sex / Gender based discrimination

The Sex Discrimination Act 1975 (SDA) is introduced not only for sex discrimination against women, but this law also applies to various acts of sex discrimination against men. This act basically states two types of sex discriminations. First one is direct, and the second one is indirect.

Direct:
A common example of this type of sex discrimination is a landowner who treats a female tenant as an inferior tenant as compared to the male tenants, due to her sex.

Indirect:
A common example of this type of sex discrimination is a landowner, who applies a specific requirement or condition for a female tenant; and female tenant is required to comply with this condition or requirement to obtain tenancy.

Victimisation

If a landowner victimise his tenants due to his/her sex by treating him or her differently and less favourably than his other tenants; it would be considered as an act of sex discrimination and is completely against the law.

Disability Discrimination Act

This Act makes it illegitimate for any landlord to discriminate his tenants due to any type of disability. A ‘disabled person’ in this act, is defined as follows:

“A person has a disability if he or she has a physical or mental impairment which has a substantial and long-term adverse effect on his/her ability to carry out normal day-to-day activities”

According to this Act, a landlord can be discriminating if:

  • He treats a tenant differently due to some reasons based to his disability.
  • If the landlord cannot justify the mentioned treatment
  • The landowners fail to fulfil Part 2, Sec 6 mentioned in the Disability Discrimination Act. This section describes the various adjustments that are usually done to such agreements for the purpose of making it suitable for a disabled tenant.
  • The landowner cannot justify his failure to fulfil the requirement mentioned in Sec 6.

Various reasons, which are Acceptable, and can be used to treat a disabled tenant with difference

Below are the various circumstances whereby it’s acceptable to treat a disabled tenant with difference.

  • Sometimes, disabled person can be treated differently on the basis of his safety and health.
    • It is quite acceptable to refuse an access of a facility to a disabled person, when it is known that allowing access to a certain facility may pose danger to others’ safety.
    • If a disabled person cannot sign an enforceable agreement legally, or have not given any legal consent, it can be acceptable to treat him differently.

Making Adjustments to Properties

Landlords are not required to make any special modifications in their properties to make their property easy to access by disabled persons.

Racial Discrimination Act

It is illegitimate for a landowner to discriminate his tenant on the basis of racial grounds according to Race Relations Act. This Act describes various types of racial grounds such as colour, race, ethnic group, nationality and national origins etc.

Under this Act, there are 4 main types of discriminations related to various racial backgrounds: first one is direct; second one is indirect, third one is victimisation, and lastly harassment.

Direct

Direct:
A common example of this type of racial discrimination is a landowner who treats a particular tenant as an inferior tenant as compared to the other tenants, due to his/her racial background.

Indirect:
In this type of racial discrimination, a landowner applies an additional requirement or condition to a tenant because of his racial background. A tenant must comply with this condition and the requirement to obtain tenancy. This is an example of indirect racial discrimination.

Victimisation

If a landowner victimise his tenants due to their race by treating them differently and less favourably than his other tenants, it would be considered as an act of racial discrimination and is completely illegitimate.

Harassment

According toRace Relations Act 1976 (Amendment) Regulations 2003, any type of racial harassment on the grounds of ethnic, race or national origins is considered illegal, excluding racism on the basis of nationality or colour.  Harassment on the basis of nationality or colour may be considered as illegal direct discrimination.
A landowner harasses his tenants on the basis of race, national, or ethnic origins, or if landowner  indulges in some form of unwanted conduct that can affect the dignity of tenants, or creating a degrading, hostile, offensive, humiliating or environment for them.

How to Tackle Discrimination

If you feel that you may have been discriminated in any form by your landlord, then you have all the rights to take a legal action against them. The first step is to take some reliable advice from a qualified and reputable attorney, the Citizens Advice Bureau or from a legal advice centre.

How to Increase Tenant’s Rent?

There may be many reasons why a property-owner can decide to increase rent; following are two of the most common ones:

  • To keep up with the rising levels of inflation
  • To take benefits from the profitable rental market

A legal way to increase rent

The most common way, used by many landlords, to increase rent is to prepare a new tenancy agreement, and get it signed by the tenants at the end of the fixed term. Clearly, this is the one of the best ways to increase rent.

It’s worth mentioning that it’s not always necessary to prepare a new tenancy agreement as it’s quite understood that the existing tenancy can become a periodic tenancy, with all the similar terms and conditions. So, you can easily get your tenant to agree to the increased rent by just sending him a letter regarding the increase, and get it signed from him. This dated letter will act as a proof of the agreement regarding the rent increase.

Rent Review Clauses

A tenancy agreement may sometimes contain rent review clauses. You need to make sure that all the clauses are fair and in accordance with Unfair Terms in Consumer Contracts Regulations 1999.

An effective way to make a fair rent review clause is to specify new figure for the rent after a specified period of time. For instance; let’s say £700pcm is the rent right at the start of the tenancy period; the clause should clearly specify that after a period of 6 months, the rent for the property will increase by, say, £50 and becomes £750. Clearly, this will be considered absolutely fair because the tenant will automatically approve the increased amount at the time of signing the agreement. At the same time, if the clause just states that the landowner may increase the rent by whatever amount he likes and feels, this will not be considered fair.

Don’t ever try to increase the rent by too much amount

What is the extent to which you want to increase rent is of utmost importance. Therefore, the increase in rent should be fair and justified.  Even if you state the new amount in your Tenancy Agreement, and it is quite excessive increase then the court can deem your increase rent clause invalid. It doesn’t matter if the tenant has signed it or not.

For example; in bankway case, the tenancy agreement consists of a rent increase clause that states the rent increase from £4,680 to a whooping 25,000. However, when the increase in rent became effective, the tenant refused to keep up with the increased amount, and thereby landlord sued him for possession.

The Court of Appeal stated that the rent increase clause was absolutely invalid as the increase in rent was quite substantial, and it was solely devised to bring the assured tenancy of property to an end. It  quite obvious that the tenant would not be able to pay the new increased amount. So, high rent increases are not at all recommended.

Is your Tenancy Agreement fair or unfair?

All terms and conditions mentioned in a Tenancy Agreement must not be unfair. In case, there are unfair Terms in the agreement, the consumer Contracts Regulations 1999 has been established to provide protection and safety to Tenants. This Regulation states that if there is any term or condition in the agreement, which is considered as unfair, it will be completely unenforceable for the Tenant.

When the terms are are considered Unfair in a Tenancy Agreement?

In order to consider a tenancy agreement completely fair, it must meet following needs and requirements:

  • All the terms mentioned in the contract should be in easy to understandable language.
  • All the terms of the agreement must pass the fairness test
  • All the involved parties in the contract must conclude that the agreement is completely fair.

Examples of some unfair terms

Following are some examples of unfair terms, which you should never use in a tenancy agreement, and you cannot enforce these terms on your tenants:

  • Terms and conditions that directs the Tenant to pay for maintenance and repairs which are legally required by the landlord.
  • Terms those allow the Landlord to enter into the home during the tenancy period; without any permission or prior notice.

How to act on unfair terms?

If you think that your tenancy agreement consists of unfair terms, then you should contact an experienced legal adviser.

In order to avail any free legal advice on these matters, you can also consult your local Citizens Advice Bureau.

Joint Tenancy Agreements

What exactly is a Joint Tenancy?

A joint tenancy is an agreement whereby you have the option of having two or more than two individuals for the same tenancy. In this agreement, all of the involved individuals have an exclusive possession of the complete property together, and they have equal rights of the rented property.

Joint Tenancy agreement is a legal agreement between the landlord and all his tenants. According to this agreement, all the tenants are equally responsible for adhering to all of the terms and conditions mentioned in the Tenancy Agreement.

An important point to note here is that a joint tenancy is not something similar to ‘tenants in common’ agreement, although they appear quite similar and often cause a lot of confusion.

What is ‘Tenants in common’?

This is something similar to a joint tenancy in context to two or more than two tenants living under same tenancy. However, here each tenant has exclusive ownership of his own specific bedroom within the property. He can also make use of their communal areas.

Important Requirements for obtaining Joint Tenancy

  • Each tenant must be of 16yrs of age or older
  • A single legal document is used to hold the tenancy of all the tenants.
  • The starting and ending dates for all the tenants must be the same
  • All the tenants must exercise equal rights to the whole property
  • All Tenants must be entitled to possess the entire property with equal rights

Liability for Joint Tenants

All the tenants involved in a Joint Tenancy are normally liable in a joint manner for any damages to the property or rent arrears. This just means that if any of the joint tenants violate any of the terms and conditions of the joint tenancy agreement, the landowner has all the rights to make a claim against all of them, or even against the individual tenant. This is considered as a great advantage for the landowner in this regard.

Joint Tenancy Guarantor

Each of the tenants will have a different Guarantor that will provide additional security to the landowner.

How to Change the Joint Tenants

In case, you want any of the joint tenants to leave your property and/or you want to rent out your property to new tenants in place of any of the older joint tenants, you need to include a new tenancy agreement. This can be easily done by Deed of Variation, which can be attached to your Tenancy Agreement, or you can prepare an entirely new Tenancy Agreement for this purpose.

How to end a Joint Tenancy

For ending a joint tenancy, you must give a written notice to every individual joint tenant; assuming that this notice complies with the tenancy agreement with regard to the termination date of the tenancy period.

What to do in case of arrears at the time of ending the joint tenancy

As already mentioned, liability of tenancy will be shared evenly between all tenants in joint tenancy. If there are any types of arrears, each one of the tenants in joint tenancy will be considered responsible for the amount overdue. This is precisely the reason why it is often recommended that you should be extra careful when you opt for joint tenancy.