Assured Shorthold Tenancies are one of the most common forms of letting arrangement for residential properties in England and Wales. Though not an exhaustive list, Assured Shorthold Tenancies are not suitable in the following circumstances:
- If you will be living in the same property
- If the rent is in excess of £25,000 per annum (for Wales) or £100,000 per annum (for England)
- If the property is not your tenant’s principal home
- If your tenant is not an individual For example, if the Tenant is a limited company or housing association
If you have any doubt that the proposed tenancy may not be an Assured Shorthold Tenancy then we strongly advise that you speak to a member of our Property department before proceeding further as there could be implications for you.
Assured Shorthold Tenancies have two advantages for you as a landlord:
1. There is a fixed date on which your tenant must leave the property; and
2. If any of the terms of the Assured Shorthold Tenancy Agreement are breached, you may be able to remove your tenant by an order of the Court.
Whilst an Assured Shorthold Tenancy does guarantee repossession of the property, it is still necessary to apply to the Court if the tenant refuses to give up possession at the end of the specified period.
An Assured Shorthold Tenancy can be for any period of time. However, a Landlord cannot obtain possession via the Courts during the fixed term of the Agreement unless the Tenant has breached any of their obligations under the Tenancy Agreement.
An Assured Shorthold Tenancy is generally only appropriate for short term lettings of between 6 and 12 months. Indeed, there are no provisions for reviewing the rent within our standard Assured Shorthold Tenancy Agreement and consequently if you grant a tenancy say for a term of 3 years, the rent will be the same throughout. The market rent may not therefore be reflected within your Assured Shorthold Tenancy Agreement.
If you wish to grant an Assured Shorthold Tenancy for a term greater than 12 months then, again, we advise that you speak to a member of our Property department before proceeding further.
At the end of an Assured Shorthold Tenancy, if no actions are taken by either party to renew the tenancy or by you as landlord to seek repossession, then the tenancy continues and is terminable by you on two months written notice. If however you wish your tenant to leave at the end of the Assured Shorthold Tenancy Agreement term you must give him/her two months prior notice in writing.
You may wish to obtain a deposit from your tenant to safeguard your interests in case the tenant breaks any fixtures and fittings at the property, or if any of the tenant(s) obligations, such as payment of rent, are breached. Should you wish to obtain a rent deposit for an Assured Shorthold Tenancy, please note that there are rules in force which require landlords to place deposits received from tenants into one of two designated schemes within 14 days of receipt. Failure to comply with the rules can have serious consequences for a landlord.
Our standard Assured Shorthold Tenancy Agreement does not make provision for any third party to guarantee the obligations of the Tenant. Therefore, if you do not obtain a rent deposit there is a greater risk for you.