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Different types of tenancy agreements in the UK

Different types of tenancy agreements in the UK

A tenancy agreement is a document that sets out the terms of a tenancy. When you’re renting out a property, having a written tenancy agreement is a good way of making sure that the rental conditions between you and your tenant are clear. However, with the different types of tenancy agreements, we have in the UK, which is the right one for you?

Tenancy types

The most common tenancy agreement is the assured shorthold tenancy and unless your property rental fulfils certain criteria, it’s likely that an assured shorthold tenancy agreement is the right one for you. But let’s go through the different types we have in the UK.

Assured shorthold tenancy (AST)

An AST is the default tenancy agreement in the UK. As long as the property is a private rental, the tenancy started after 15 January 1989, the property is the tenant’s main accommodation, and you as the landlord don’t live in the property, it is likely to be rented on an assured shorthold tenancy.

ASTs are typically given for a period of six months but can be for longer and they usually are as most ASTs will usually state an initial fixed term of 12 months. After the fixed term is over, the tenancy agreement automatically becomes periodic tenancy, (a monthly rolling contract) with the same rent if you don’t sign a new contract with your tenant.

You are also required to protect the tenant’s deposit in a government-approved deposit protection scheme.

A tenancy cannot be an AST if:

  • it began or was agreed before 15 January 1989
  • the rent is more than £100,000 a year
  • the rent is less than £250 a year (less than £1,000 in London)
  • it’s a business tenancy or tenancy of licensed premises
  • it’s a holiday let
  • the landlord is a local council

Assured tenancy

Assured tenancies don’t provide landlords security of tenure and equip tenants with more protection against eviction. Assured tenancies were more commonly used in the past: tenancies that began between 1989 and 1997 may be assured tenancies, and they give tenants long-term tenancy rights.

Under assured tenancies, landlords must wait for specific circumstances that break the tenancy agreement to occur. So, If you’re just beginning to rent out your property, you’re unlikely to opt for this type of tenancy. 

Non-assured shorthold tenancy

Non-assured shorthold tenancies tend to be used when assured shorthold tenancies can’t be. This may be because the rent is less than £250 per year, the tenant has their main home elsewhere, or if a landlord lives in the same property as their tenants but doesn’t share any facilities.

Landlords who opt for an assured shorthold tenancy don’t need to pay a tenancy deposit into a government-backed deposit protection scheme, and you don’t have to give a Section 21 or Section 8 Notice to end the tenancy. However, the tenant has the right to stay in the property until the end of the fixed term, as long as they comply with the terms of the tenancy agreement.

Excluded tenancy

Excluded tenancies tend to be used by landlords who live in the same property and share facilities with their tenants. Landlords don’t need to protect the tenant’s deposit in a government-approved deposit scheme, and they can usually evict the tenant without a court order. Usually, this means the length of the rental period, so if your tenant pays rent weekly, landlords are within their rights to give one week’s notice.

Regulated tenancy

This form of tenancy was used before 1989, and it was a long-term tenancy. You are unlikely to use this type of tenancy agreement.

Company let

A company let is when a company rents residential accommodation for its own staff or directors. So you are renting to a company rather than an individual and this means that it’s not governed by the same rules when it comes to things like deposit protection and eviction.

Renting property to companies can be very lucrative but if you rent to the wrong company it can also be problematic.  A company can close down, for example, if it becomes insolvent, in which case it may prove impossible to recover unpaid rent. So ensure you do all your due diligence before renting the property to a company.

Can I change a tenancy agreement?

Usually, tenancy agreements can only be changed if both the landlord and tenants agree. If this is the case, all changes should be recorded in writing by either drawing up a new tenancy agreement or amending the existing tenancy contract.

Do I need to get a written copy of my tenancy agreement?

Landlords in England and Wales aren’t legally required to provide tenants with a written copy of a tenancy agreement.

A tenancy agreement can exist even if there’s only an oral agreement between a tenant and a landlord, but it is important to know that oral tenancy agreements can be difficult to enforce as there is evidence to prove what has and hasn’t been agreed.

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Electrical Installation Condition Report Updates for Landlords

Electrical Installation Condition Report Updates for Landlords

An Electrical Installation Condition Report is a formal document produced by a qualified electrician after completing an assessment of the electrical systems of your rented property.

The electrical installation for your properties as landlords must meet regulated standards in order to ensure safety. Landlords are therefore responsible for ensuring the property they rent out has an electrical installation. It needs to be safe to use by your tenants throughout their tenancy.

What's new with Electrical Installation Condition Reports

Prior to June 2020, it wasn’t a requirement for landlords to get the Electrical Installation Condition Report. However, after June 2020, new Regulations require landlords to have the electrical installations in their properties inspected at least every 5 years.

The new Regulations apply to all new tenancies from 1 July 2020 and for existing tenancies, from 1 April 2021.

Electrical Installation Condition Report

The government can impose large fines and possible prison sentences if you do not have an EICR. It is also not enough to say you were not aware you had to have a report done.

What happens when I don’t have my electrical system tested out?

Aside from the EICR, as landlords, there are several health and safety laws you have to abide by. Failure to fulfil those legal duties puts you at risk of claims of negligence or damage.

The EICR is also important when it comes to insurance. You need to be confident that your insurer will cover potential damages to your property caused by electrical faults.

What happens if I don't pass the EICR?

If your EICR report reveals issues with your electrical system, the results will come out as “Unsatisfactory,”. This means you will need to undertake some remedial work. The qualified electrician should provide you with a list of what should be done and a fixed price quote.

You will need to resolve any electrical issues within 28 days, beginning with the day when you received the recommendation from the qualified electrician.

Need more help?

More information about how to carry out the checks is available online at www.gov.uk.

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Are right to rent checks a legal requirement?

Are right to rent checks a legal requirement?

So what are right to rent checks and why should you even care?

The right to rent checks relates to a person’s immigration status. So this is when a prospective tenant(s) of a rental property shows their identity documents to a landlord or letting agent. The landlord/letting agent must take a copy of the documents seen and record that the check has been completed.

At the start

Before the start of a new tenancy, a landlord/letting agent must check all tenants aged 18 and over, even if:

  • they are not named on the tenancy agreement
  • there’s no tenancy agreement
  • the tenancy agreement is not in writing

Children under the age of 18 are exempt from the checks, but landlords/letting agents may need to verify their age.

right to rent

Immigration status

Depending on the tenant(s) immigration status and which type of leave to enter or remain in the UK they have, people can have:

1. An unlimited right to rent

  • a British or Irish citizen
  • a Commonwealth Citizen with right of abode in the UK
  • a person with indefinite leave to remain (ILR) in the UK, including settled status granted under the EU Settlement Scheme
  • a person with no time limit on their stay in the UK
  • After 30 June 2021 EU, EEA and Swiss nationals and their family members no longer have an unlimited right to rent unless they meet one of the conditions listed above.

2.A time-limited right to rent

  • they have been granted leave to enter or remain in the UK for a limited period – this applies regardless of the reason for granting the leave
  • they have been granted a time-limited permission to rent by the Home Office.

3.No right to rent

  • they do not have valid leave to enter or remain in the UK, and have not been granted discretionary permission to rent by the Home Office.

Why do you have to carry out these checks?

The Immigration Act 2014 imposed on all landlords in England (including lodger landlords) the obligation to find out whether the proposed occupants have a ‘right to rent’ property in the UK.
The need to carry the checks out in person was suspended at the beginning of the coronavirus pandemic, although landlords with properties in England must still perform Right to Rent checks online.

The temporary adjustments to right to rent checks due to COVID-19 will end on 5 April 2022 (inclusive). New guidance will be issued prior to 6 April 2022.

What are the landlord’s/agent’s responsibilities?

The landlord/agent must:

  • Check the adult tenant(s) who will live in the property as their only or main home
  • Ask the tenant(s) for the original documents that show they have the right to be in the UK
  • Check the original documents with the tenant(s) physically present and ensure they are valid
  • Make copies of the original documents and record when the check was completed
  • Conduct follow up checks at the appropriate time
  • If follow up checks reveal that a tenant(s) in a rental property no longer has a valid ‘Right to Rent’ then the landlord/letting agent must report that person to the Home Office.

What documents are acceptable?

Acceptable documents that a tenant(s) can use to demonstrate their identity and Right to Rent are dependent on their nationality. For example, a valid passport that shows a right to reside in the UK lawfully.

Follow-up checks on time-limited right to rent

Where accommodation is let to, or occupied by, a tenant(s) with a time-limited right to rent, a follow-up check must be carried out before the end of the ‘eligibility period’, which is the latest date of:

  • 12 months after the previous check
  • when the tenant(s) leave to enter or remain in the UK expires
  • the expiry of an immigration document
right to rent

Failure to conduct right to rent checks

Failure to conduct the checks and the subsequent provision of accommodation to a person with no right to rent may lead to a civil or criminal penalty.

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Landlords – How to check for and avoid frozen pipes

Landlords – How to check for and avoid frozen pipes

There’s a level of shared responsibility between landlords and tenants when it comes to maintaining the property during the winter and reducing the chances of pipes freezing. The landlord will be responsible for making sure that the water and heating supply are in good working order and fixing any maintenance issues.

The tenant is responsible for making sure the property is properly looked after by heating it sufficiently, clearing blockages, and checking the boiler regularly.

Winter can bring about a few problems for landlords, one of which is frozen pipes. So it is important that as a landlord you know the signs of frozen pipes, how to avoid them and should it happen, what you can do to rectify it.

What is a frozen pipe and how to detect it

Your pipes always have a little water in them and when temperatures drop, that water freezes and you find that nothing can pass through.

Below are the most common signs of frozen pipes:

  • Frost is on the exterior of the pipe– if you can see frost on a pipe, then there is a high likelihood that it is frozen.
  • Little or no water coming from the pipe – If there’s no running water, or only a then there is a high chance that the pipe leading to the tap may be frozen.
  • You notice bad/odd smells from the faucet or drain – if a pipe is frozen, you may notice a bad smell coming from the taps or drains.
  • Your boiler isn’t working – if this happens during a cold snap, the condensate pipe (which is close to the boiler and takes condensation from the boiler to a drain) may be frozen.

Below are some practical things landlords can do to help reduce the risk of frozen pipes:

• carry out regular inspections of the property so you can spot any problems missed by tenants before they become serious
• if any issues are found, make sure to address it quickly
• keep in touch with the tenants so you are aware f any issues sooner rather than later.
• Have a skinning fund for maintenance and repairs to your property so if you do need to carry out any works, you are able to afford it.

Ways you could try to prevent frozen pipes

• Insulate pipes and water tanks.
• Don’t switch your heating off completely but rather you could set your thermostat to a low temperature so the pipes don’t freeze.
• Try to turn your taps on and off every day to try to prevent the pipes from freezing.

How you can temporarily fix frozen pipes?

If you find yourself in the unfortunate position where the pipes are frozen but have actually burst, then you may still be able to save the pipes. You will probably need to call a plumber to help thaw your pipes, but if it’s not too serious here are some ideas you could use to thaw the frozen pipes yourself:

• You can use a good old fashion hairdryer to thaw pipes, but make sure you never use a naked flame or blowlamp as it could be dangerous
• you can try pouring hot water over the pipe but be very careful
• you can turn off the stopcock to stop the water supply
• you can use towels soaked in hot water, or hot water bottles, to begin thawing the pipes (start at the end of the pipe nearest the tap).

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