Assured Shorthold Tenancy

 

What is an Assured Shorthold Tenancy Agreement (AST)?

The assured shorthold tenancy is the default legal category of residential tenancy in England and Wales. It is a form of assured tenancy with limited security of tenure, which was introduced by the Housing Act 1988 and saw an important default provision and a widening of its definition made by the Housing Act 1996.

Since 28 February 1997 in respect of accommodation to new tenants who are new to their landlords, the assured shorthold tenancy has become the most common form of Landlord Tenant Agreement that involves a private residential landlord. The equivalent in Scotland is short assured tenancy.

To create an Assured Shorthold Tenancy, the tenancy must meet the basic requirements of an assured tenancy (excluding the security of tenure effects) and the following:

  • The tenancy started between 15 January 1989 and 27 January 1997 (inclusive) and was accompanied by a prescribed warning, was for a fixed term, and for at least six months; or
  • The tenancy started at or after 28 February 1997
  • The tenancy is not excluded by a notice stating it is not a shorthold before or after the tenancy
  • The tenancy does not specify within it that it is not a shorthold
  • The tenancy is not a letting to an existing assured tenant of the landlord’s whether of the same premises or not (and whether to that tenant alone or part of a group)

The only potential landlord’s disadvantage of a shorthold is the right of the tenant to refer the rent initially payable to a rent assessment committee; however, it can reduce the rent only if it is “significantly higher” than the rents under other comparable assured shortholds.

If the landlord has been able to agree a rent substantially higher than market demonstrates, the landlord can serve a notice before or after the tenancy has begun stating it is not to be a shorthold, where no rent assessment application has been made.

In other regards, except security of tenure, as a subset of assured tenancies, assured shorthold tenancies (ASTs) follow the definition requirements of assured tenancies, e.g. which includes maximum and minimum rent levels to exclude the most unusual extremes

Notice of Termination of Tenancy

Giving notice to terminate an Assured Shorthold Tenancy must be handled with care. For landlords and tenants, it’s very important to follow the rules exactly as the law requires, otherwise costly delays are likely.

Most tenancies end amicably with the tenant giving the landlord notice to leave. However, in a minority of cases the landlord may have to resort to eviction.  Recent legislation has resulted in a more involved process where it is imperative that landlords / agents have issued the correct documentation.