What is an Assured Shorthold Tenancy (AST)?
What is an Assured Shorthold Tenancy (AST)?
We understand that signing any kind of a contract is a huge deal, and when you’re squinting to read that fine print you most certainly will want to know what terms like ‘AST’ mean.
Simply put, Assured Shorthold Tenancy is a fixed-term contract, and one of the most common types of tenancy that a tenant will rent from a private landlord or letting agent. When tenants move into a new property they will most likely have to sign an Assured Shorthold Tenancy (AST) contract. Most private tenants actually have an Assured Shorthold Tenancy, so it’s a good idea to understand the key features of this type of tenancy.
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What are the basics of an assured shorthold tenancy?
- Their original tenancy started on or after the 28th of February 1997
- They don’t live with their landlord (living with a landlord is a rare case, of course!)
- Their rent is more than £100,000 a year
- Their rent is less than £1,000 a year in London or £250 a year outside London
AST’s can have fixed terms – often 6 or 12 months. They can also be periodic, rolling weekly or monthly. However, what if your tenant had signed a tenancy agreement and now wants to cancel?
It can be understandably frustrating for a landlord, so there are a few options for you. Some contracts could contain a ‘break clause’ which allows the tenant to end the contract early by giving their notice. But you can also simply insist that they comply with the tenancy agreement they’ve signed, because the law is on your side here, it would leave your tenant with no other option but to comply.
Before your tenant has their big move-in day, be sure to hand them a copy of the latest gas safety certificate, EICR, and Energy Performance Certificate for the building. At Mashroom, you can book a call with us, so we can go through all the legal certification you require and update it if necessary.
You can also give your tenant a written statement of the basic terms of your agreement so that they can clearly understand them and have something to refer to.
Here are some main points you should include in writing:
- The start date of the tenancy.
- The rent payable (and how regularly it should be paid) and rent due date.
- Any rent review clause.
- The length of any fixed term agreement.
Also note that your tenant has the right to your name and address, so it’s worth jotting that down too.
How many types of tenancies are there?
- Assured shorthold tenancy. The most common type – covers the majority of long-term renting, including the details between the landlord and tenant(s). Most ASTs are for an initial 6 – 12 month fixed term.
- Statutory periodic tenancy. This tenancy will come into play if the tenant or the landlord, for whatever reason, does not wish to commit to another fixed-term contract, but are happy to go ahead month by month. However, this doesn’t mean that the tenant can just up and leave at any given moment. Tenants are required to give the landlord at least one month’s notice if they wish to leave the property, and landlords are required to give tenants at least two months notice, if they wish for the tenant to vacate the property.
- Tenancy-at-will. An agreement between the tenant and the landlord that can be terminated at any time.
- Excluded tenancy. If a landlord is renting out part of their home to a tenant whilst still living there themselves, an Excluded Tenancy Agreement is a potential option.
- Company let. In some cases, landlords decide to rent their properties through a company rather than directly to the tenant.
- A regulated tenancy. It’s uncommon these days, but it does still exist. These types of long-term tenancy agreements hark back to renting in the UK before 1989 (when ASTs were introduced).
Can a landlord serve a notice to end the assured shorthold tenancy?
Another key feature that sets AST apart from any other type of tenancy, is the fact that a landlord is able to evict their tenant without a reason using a Section 21 eviction notice. Here’s a quick breakdown of the two types of eviction notices and their differences.
- A Section 21 eviction notice is a legal notice from landlord to tenant that begins the process of ending an assured shorthold tenancy. A Section 21 notice means that the landlord does not have to give any reason for wanting to regain possession of the property. Most tenancies will end by mutual consent, but in instances where this doesn’t occur, the section 21 notice will come into place.
- On the other hand, a Section 8 notice is different. This is a fault- based notice that is given when there’s been a clear breach or fault that the tenant has made, due to which the landlord is choosing to end the tenancy.
And for a landlord renting to students, because an assured shorthold tenancy runs for a certain amount of time (in most cases 6 – 12 months), this is also one of the most common types of tenancy for them. Note that the eviction process still has to be upheld the same way for the student renter, and an end of tenancy notice period should be served.
What is the notice period for tenants on Assured Shorthold Tenancy?
A tenant does not have to leave just because the landlord tells them to do so or because their fixed term contract has ended, as there are eviction procedures to follow that protect the tenant from being unfairly thrown out of their home.
Every landlord must follow the eviction procedures carefully, unless the tenant agrees to go on their own of course. It’s always extremely important for each landlord to follow the process correctly – you can’t just change the locks, or worse yet, throw them out with their belongings and possessions! Learn from tragic mistakes that landlords have made in the past, as there is no need to risk jail or a hefty fine. And, don’t forget, if a tenant is facing eviction, they can always ask the council for help.
If a tenant would like to stay longer, they can either agree to a new fixed term contract (being aware that their rent may increase), or they could stay without signing a new contract as their agreement becomes periodic and rolls on monthly at the same rent.
However, if the tenant does want to leave, they can usually end their tenancy by simply moving out and returning their keys by the end of the fixed term. Be sure to spell out clearly in the tenancy agreement if you’d like for your tenant to give an end of tenancy notice that they’re leaving.
The type of tenancy you determine is really up to you, so read up on your options to decide what’s best for your situation. All that is left now is finding the right tenant for your property, so join Mashroom to get full access to all features that include our free tenant find and customisable tenancy agreement!