When you’re renting out a property or looking for a property to rent, different types of tenancy can be confusing to understand. Here we go through everything you need to know about your next tenancy agreement.
As a landlord, you want
well behaved tenants
- fixed term
- When and how the tenancy expires
As a tenant, you want
- fair rent
- initial fixed term
- how the landlord accepts rent and when to pay
One of the things you should be most aware of is when a tenancy agreement automatically renews. It’s important to know if your tenancy agreement has a clause that could continue, and you didn’t know because you didn’t read the contract properly.
A guide to different types of tenancy
Tenancy agreements are a contract between landlord and tenant. It describes as written the conditions of the tenancy. This includes how long the tenancy lasts, how much rent the landlord expects the tenant to pay, and how the payments are due.
Being deprived of a tenancy will prevent you from being affected as quickly as the tenant pays your rent, and the tenancy law of 1925 defines it.
There’s a couple of exceptions to this rule, including arrangements with family. A failing tenancy agreement does not remove a landlord from its statutory obligations, and it’ll save you from another bunch of pain on the journey.
Why do you need a tenancy agreement?
The rental agreement constitutes a formalization of your rights on paper and set out a sequence of expectations for that tenancy agreement. Other variables can also be considered, such as rental income and the number of tenants a landlord can sublet.
These provisions will significantly help when the landlord wants to deposit the move. There’s no legal requirement to have a rental agreement but getting a written agreement offers protection for you and your landlord.
Different types of Tenancy Agreements
There are various types of rental contracts, including assured tenancy shorthold (AST) and company let. The tenancy agreement specifies the complete terms for your stay at home, and it specifies merely the time you stay there on-site and their duration.
We created a guide to explain all different kinds of agreements for all the professionals. For more information on rental contracts, find the best rental deals available in the market today, back for Mail Online. Returning to a page, you came from [link).
Different types of tenancy agreements provide other rights: most people who rent from a private landlord who doesn’t live with them occupy a guaranteed shorthold tenancy. If you rented your house for the previous month or period, securing your home in the future may mean a safe stay.
If you want a different kind of house tenancy, you must look through the deal. Some landlords use incorrect written agreements, so your tenancy type could differ from what your tenancy contract says. Use Shelters Tenant Checker to find out what kind of tenancy you have.
These tenancies are more vital for tenants; if you live with your landlord and share a living space with your landlord, you’re probably a lodger and have fewer rights.
If you’re looking to rent or rent out a property, you might not be aware of the different types of tenancy agreements. If you’re not, then it might help to think about them before entering into either a contract.
The three most common types of a tenancy agreement
- assured shorthold tenancies (ASTs)
- occupiers’ contracts
- excluded tenancy agreements
Section 5 of the Housing Act 1988 states, all ASTs are automatically protected by law after the first six months. This saves the tenant from eviction without good reason (provided they pay their rent on time).
Assured shorthold tenants also have full occupation rights, including access to communal areas and protection against harassment.
If you’re thinking that your landlord is not meeting these conditions, then you can take them to court – but check your tenancy agreement first as some clauses may prevent this (e.g. landlords needing permission before entering into common parts).
Assured shorthold tenancy (AST)
Expect a tenancy with this label to have a short fixed term (usually 6-12 months) and only require the tenant to pay rent every month.
Under an AST (and sometimes under occupier contracts), both parties must follow specific rules stated within the contract that both signs. These rules prevent any unfair treatment of tenants by landlords and can include anything from limits on rent increases to obligations about repairs.
Tenants usually have no access to communal areas in their building but will be protected against harassment.
What are the benefits of assured shorthold tenancy?
- Fixed-term contract of six months to a year.
- Receives some protection from harassment from the landlord or agent.
What are the disadvantages of an assured shorthold tenancy?
- Cannot have pets unless agreed with the landowner.
- The landlord can end the tenancy at any time with two months notice (unlike an occupier’s contract). If you want more security, consider signing another type of agreement, such as an assured tenancy.
- Often has no access to communal areas in their building and cannot make changes to the property without permission from the landlord, such as putting up shelves or removing carpets (although this varies depending on your agreement).
Read your agreement carefully before committing yourself. Avoid signing an AST if you’re settling in a new area and want to get involved with the community.
Expect a tenancy with this label to have a longer fixed term (usually 1-2 years) and require the tenant to sign up for periodic rent payments at least once every three months. Tenants typically have access to communal areas within their building but will not be protected against harassment by the landlord or agent.
What are the benefits of an occupier’s contract?
- A fixed-term contract that lasts for more than six months.
- Has access to common parts of their property unless agreed otherwise, therefore can make changes necessary without needing permission from the landlord except those which violate any relevant rules.
- Tenants cannot be ejected without a court order.
What are the disadvantages of an occupier’s contract?
- The landlord can end the tenancy at any time with two months notice (unlike an assured shorthold tenancy). If you want more security, consider signing another type of agreement, such as a leasehold contract.
- Sometimes receive no protection from harassment by the landlord or agent.
Since tenancy agreements vary depending on which company/landlord they come from, it is best to look out for these signs when hunting for your perfect new home online or in-person that will say whether their housing falls under either an AST or an occupier’s contract.
What have excluded tenancies?
This is when the tenant lives in one room and shares the kitchen, bathroom and living areas. It’s a lodger in someone’s house, which does give you fewer rights when compared to an assured tenancy.
What are the benefits of excluded tenancy?
There is a clear benefit to an excluded tenancy because you will have a stable monthly rent and a room in a shared dwelling. You also won’t have to worry about going through the eviction process if you choose this type of tenancy agreement.
After signing your tenancy agreement, please ensure that you get it checked by an expert if there are any issues. This will ensure that you clearly understand what is being asked of you and what you can do on the property.
Joint tenancy agreements
These are good for people who want to share the responsibility and costs of a property.
If one person misses rent payments, it is up to all tenants to make up the shortfall. If you move out, you will still be responsible for the contract (although some allow individual co-tenants to end their part in the agreement).
The main advantage is that if one tenant pays more than their fair share towards household bills/repairs, they can get that money back when they move out by claiming against their former co-tenant(s). However, this isn’t always possible, and legal aid has been cut, so it’s harder to pursue claims like these through the courts
These are usually for a short term and can be ended with just one month’s notice. A verbal agreement cannot have an end date, so if you don’t want to leave the property, but your landlord wants you to go, they can apply to the court to get the parcel back even without being in breach of tenancy.
Renting is becoming popular in the UK as it is less hassle than owning a house. Before renting out your property, you must understand all aspects of tenancy agreements and their meanings for both parties involved.
Written tenancy agreement
Having a written tenancy agreement makes everything more evident to all parties involved. It sets out all the rights and responsibilities that your land and you must adhere to.
Always read over any documents carefully and make sure you have a clear understanding of everything involved.
A written lease should explain your rights and their obligations. Request the owner to explain everything about what you don’t know. Nevertheless, certain rights and responsibilities apply to a given contract. This agreement often mentions who to contact for repairs, rules about lodgers, sublettings and transfer of tenancies.
It should include the conditions you must cover with the deposit, the amount to be paid and circumstances that mean nothing from the deposit. Regulations about pets, guests or smoking are also rules concerning animals or guests—the time for an extension to be paid if you want to be increased by the landlord.
The written agreement should include the following?
- the name of all people renting
- the address of the property
- how much deposit is to be paid
- what your deposit covers
- reasons why you wouldn’t get the deposit back
- the duration of the tenancy
- rules on how the tenancy can end
- name and address of your landlord
- name and address of letting agent if applicable
- what the rent is,
- the date the rent should be paid
- method of payment
- Does the rent include utility bills
- is council tax included?
- What happens if any appliances become faulty
- Are pets allowed?
- Can the tenants smoke on the property?
What’s the best tenancy type for the landlord?
The landlord is the one who will benefit most from an assured shorthold tenancy agreement, and this is because they can evict quickly (the notice period is at least two weeks) and make sure that the rent will be paid on time every month.
The tenant will benefit most from a joint assured tenancy basis, even if they live with their partner in the property.
A joint agreement means that both tenants are equally responsible for paying the rent and any bills, so there isn’t just one person who has to take care of it all.
Lastly, the regulated tenancy may seem like your best option when you don’t want to sign up for an assured shorthold tenancy but still want some legal protection against eviction by your landlord.
This type of tenancy can cover any length you want, but be prepared to pay more if the duration is extended.
If not, it may result in your landlord taking you to court for eviction, even though they cannot prove you are at fault.
Do I need to give notice when before leaving?
It’s recommended that tenants give their notice at least two months before vacating a property; however, many things could change this rule, such as;
If you find a new house or apartment to live in before giving notice, it may be advised that you stay there for the last month of your tenancy. This means less stress from moving out and maybe even an incentive from your landlord to leave early. If you need to go suddenly, it may be best to try and insert a clause saying only four weeks notice is necessary.
How long is a tenancy agreement?
Most tenancies will begin monthly or yearly, but this is entirely up to the landlord and tenant to agree upon. As with all agreements, it will have a start date and an end date, so you must add this into your written agreement if you wish it to last more than one year. The minimum length of time should always be stated within the contract, so both parties know what is expected of them.”
Are pets allowed?
It doesn’t matter if pets are allowed or not, but it’s essential to ask about any pet restrictions, such as the dog’s size and expected cleaning costs.
Can tenants smoke on the property?
Smoking is usually allowed within a tenant’s own home; however, it’s always worth checking to make sure you aren’t going to be charged for an extensive clean if you do plan on doing so.
Moving can be stressful, but you should get an inventory report done before your move. This means that everything in the property will be listed. Anything that’s been damaged or missing items at the end of your tenancy will either be refunded to you by the landlord or deducted from your deposit.
Employment-related tenancies refer to temporary residence given to employees of a particular company to help them perform their work. The accommodations are provided by the employer and are detailed in the contract of employment.