TENANCY

TENANCIES

The Housing Act 1988 (amended 1996) has given rise to two types of Tenancy being Assured and Assured Shorthold Tenancy as well as exisitng Company Tenancy and Contractual Tenancy.

A) ASSURED TENANCY
Certain criteria has to be satisfied for a tenancy to qualify for assured status. Assured Tenancy gives the Tenant security of tenure but at a market rent negotiated between the parties. The Landlord may request back possession of the property let on a Assured Tenancy but must obtain a COURT ORDER. This has its advantages but is not as flexible.

B) ASSURED SHORTHOLD TENANCY (AST)
This Tenancy is attractive to Landlords at it offers market rents without security of tenure beyond the contractual term and the majority of Tenancies are based on this format. However, certain criteria must first be met:

• The Tenant must be an individual.
• The Property must be the Tenant's main residence/home.
• The Rent cannot exceed £25,000 per annum
• The Landlord must not occupy the same property.

If the property is let under AST, the Landlord can issue a Section 21 notice to guarantee possession provided the term of the shorthold is expired and not less than 2 months notice has been given to the Landlord, stating he requires possession.
If court action is needed, this can be obtained on a number of different grounds against the Tenant.

C) COMPANY TENANCY
This is governed by contract law and is not regulated by the Housing Acts of 1988 or 1996. It is used when a Private or Public Limited Company (excluding Partnerships or Sole Trader) want to enter into a tenancy.
There is no security of tenure and rental payments are often made on a quarterly basis by prior agreement.

D) CONTRACTUAL TENANCY
Contractual Tenancy also falls outside the provisions of Housing Acts of 1988 and 1996 and is not regulated by statute. It is most commonly used where the rent exceeds £25,000 per annum and both parties have the freedom to contract as they choose, but must then rely solely on the provisions of that Agreement.