There are several different types of tenancy agreement in the UK.
One of the most popular is an assured shorthold tenancy.
Whether you’re renting out a property or are a tenant, it’s worth understanding this.
Read on to learn what it is, how it works, and more.
Assured shorthold tenancies: Definition
An assured shorthold tenancy (AST) (sometimes called a fixed-term tenancy) is the most common type of tenancy in the UK.
It gives a set time frame for a tenant to rent a property.
For a tenancy to be an assured shorthold tenancy, it must meet all of the following criteria:
You’re a private landlord or housing association
Social renting (from a council) doesn’t fit the criteria. Only renting in the private sector does.
The tenancy started on or after 15 January 1989
Currently, the UK government favours this type of tenancy agreement.
Most other forms are considered outdated, albeit still in practice nationwide.
The property is your tenants’ main accommodation
Your tenants must live there themselves, as their main accommodation.
You may not meet the criteria if they’re living somewhere else permanently.
You do not live in the property yourself
The landlord can’t live in the house themselves. This type of agreement only applies when it’s being let out.
What are the other types of tenancy agreement?
An assured shorthold tenancy isn’t the only type of rental agreement in the UK.
There are three other major tenancy agreements you can find.
1. Assured tenancies
This means that the renter can live there indefinitely. There’s no threat of being evicted by the landlord.
The tenancy only ends when the tenant decides to leave. Or when they pass away.
It’s extremely rare for new assured tenancy agreements to be created today.
2. Excluded tenancies
This type of agreement has fewer protections for tenants.
You often see it when you have a lodger and share rooms with them in your home.
3. Regulated tenancies
This means that your tenants have increased protection from eviction. They can also apply for a fair rent.
These agreements were usually implemented in 1989 or earlier, as they were phased out afterwards.
Assured shorthold tenancy vs assured tenancy
Assured shorthold tenancies and assured tenancies are not the same thing.
An assured shorthold tenancy is for a fixed period. The renter cannot stay there indefinitely.
Once the fixed term expires, they must either renew the contract or move out.
An assured tenancy gives the renter the right to live in the property for life. It only ends when they choose to leave or pass away.
And even in the latter scenario, the contract may state that the leasehold instantly transfers to someone else.
What happens at the end of an assured shorthold tenancy
One of two things can happen:
- The contract is renewed
- The renter moves out.
The landlord can evict the tenant at this point if they wish. The renter doesn’t need to be a problem tenant for them to do this.
An assured shorthold tenancy can also be periodic, which means it automatically renews at the end of a fixed term period.
Ending assured shorthold tenancies early
There is usually a notice clause added into tenant contracts.
If tenants want to leave sooner than this, they can only do this if their landlord agrees. They should write to landlords to request it.
If landlords say no, there’s usually very little tenants can do, because they have signed the contract.
You can end an assured shorthold tenancy early if you are a landlord. This is done by serving your renters with an eviction notice.
This will usually be via a Section 21 or a Section 8, depending on the circumstances.
Extending assured shorthold tenancies
Tenants should speak to their landlord if they want to extend their assured shorthold tenancy. If the latter agrees, it can be arranged.
They may be willing to do it if you are well-behaved and meet all repayments.
But if they have decided to sell the house once you leave, there’s often little you can do about this. (Some landlords instead sell with tenants in situ.)
There may be renewal fees for tenants involved with extending a tenancy.
