What Is An Assured Shorthold Tenancy?

What Is An Assured Shorthold Tenancy?

What Is An Assured Shorthold Tenancy?

An assured shorthold tenancy (AST) is the most common type of rental agreement between private landlords and tenants in England and Wales. They provide limited security of tenure for tenants, usually lasting from 6 months to 3 years.

The landlord has an automatic right to repossess the property when the fixed term ends, as long as they give sufficient notice. ASTs must follow legal requirements on deposits, safety, and fees.

Tenants have rights including protection from unfair eviction and illegal fees. Either party can end the tenancy by giving notice as required by law.

An Assured Shorthold Tenancy (AST) is the default legal category of residential tenancy in England and Wales. It is a form of assured tenancy with limited security of tenure, introduced by the Housing Act 1988 and further defined by the Housing Act 1996.

ASTs are agreements between a tenant and a landlord for living in a rented property, providing protection for both parties.

An AST typically includes the following terms:

  • Start and end date of the fixed term
  • Rent amount and payment date
  • Address of the rented property
  • Name and address of all parties (tenant, landlord, and letting agent)
  • Rent review terms

A tenancy is considered an AST if it meets certain criteria, such as the tenancy starting after January 15, 1989, the property being the tenant’s main residence, and the landlord not living in the property.

There are exceptions where a tenancy cannot be an AST, such as tenancies starting before January 15, 1989, rent exceeding £100,000 per year, or the property being let for business purposes.

ASTs can be either fixed-term or periodic. Fixed-term ASTs have a specific duration, such as 12 months, while periodic ASTs continue on a month-to-month or week-to-week basis after the fixed term ends.

At the end of the fixed term, the tenancy can become a periodic rolling tenancy or a new fixed term can be agreed upon

What Is The Difference Between A Shorthold And Assured Tenancy?

The main differences between an assured shorthold tenancy and an assured tenancy are:

  • Security of tenure:

Assured shorthold tenancies give landlords an automatic right to repossess the property when the fixed term ends, with having to give a reason.

Assured tenancies require the landlord to prove grounds for possession, like rent arrears or breach of tenancy. Tenants can remain indefinitely.

  • Fixed term:

Assured shorthold tenancies are commonly granted for a minimum 6 month term. There are no minimum terms for assured tenancies.

  • Notice periods:

To end an assured shorthold tenancy, the landlord must serve a Section 21 notice giving at least 2 months notice. Assured tenancies require longer notice periods depending on circumstances.

  • Rent increases:

Rent can only be increased during a fixed term if contractually agreed. For periodic assured shorthold tenancies, rents can be increased with 1 months’ notice. Assured tenancy rents can only be increased if agreed.

  • Eligibility:

Any residential property can be let on an assured shorthold basis. Assured tenancies have more restrictions like local authority nominations.

So in summary, assured shorthold tenancies favor landlords as they can regain possession more easily. Assured tenancies provide tenants with much greater security of tenure.

Shorthold Tenancy (Assured Shorthold Tenancy or AST) and Assured Tenancy (AT) in a table format:

Aspect Shorthold Tenancy (AST) Assured Tenancy (AT)
Tenant’s Security Typically offers less security as it is often for a fixed term, providing the landlord with a simpler process to regain possession. Offers more security as it doesn’t have a fixed term, allowing tenants to stay as long as they wish, subject to specific conditions.
Fixed Term Commonly has a fixed term (e.g., 6 or 12 months) with the option to become periodic or renew. Does not have a fixed term and continues until the tenant decides to leave or specific legal grounds are met for possession.
Possession by Landlord Landlord can use a Section 21 notice to regain possession after the fixed term ends with at least two months’ notice. Landlord typically has more limited grounds for possession and may require a court order to regain possession.
Common Usage More common in modern tenancy agreements, providing flexibility for both landlords and tenants. Less common in recent tenancies due to the increased security it offers to tenants.
Grounds for Possession Landlords usually have broader grounds for possession under an AST, including the end of a fixed term. Landlords have more limited grounds for possession under an AT and must meet specific legal criteria.

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