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Types of Tenancy Agreement Explained

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A tenancy agreement is a written document that lays out the terms and conditions of a tenancy, and they are a great way to ensure the rights of both the tenant and the landlord are clearly understood. 

Understanding your rental agreement before you sign it is crucial. However, this can be easier said than done!

Time to iron some things out and set the record straight. Here’s a closer look at the different types of tenancy agreement to help you make sense of it all.

We’ll soon help you get to grips with the ABCs of renting.

Different types of tenancy agreements

There are four main types of tenancy agreement in the UK. These are:

Assured shorthold tenancy agreement (AST)

An assured shorthold tenancy (AST) is the most common tenancy agreement used when a property is rented out in its entirety. Usually, a minimum fixed term tenancy of 6 or 12 months is agreed with an assured tenancy. No rent increases can occur during this time unless agreed.

Once the fixed time is up, it automatically rolls over to a periodic tenancy.

Assured shorthold tenancy (AST) room only agreement

An AST room only agreement is most relevant to houseshares and bedsits where there are shared facilities between mixed tenants. Each tenant/room will have a separate AST agreement and rental calculations are based on the room only.

Non-housing act

Certain tenancy types are excluded from being classified as AST tenancies. These are commonly found when:

  • The tenant is a company (company let)
  • The rent is above the prescribed limit
  • The landlord occupies part of the building
  • The property is not used as the tenant’s primary place of residency (pied-à-terre)

These tenancies aren’t covered by the Housing Act or the regulations on tenancy deposit protection. This means you need to read the terms very carefully.

Lodger’s agreement

A lodger’s agreement can be a slightly more informal arrangement where both the landlord and tenant live in the property.

Non-assured hold tenancy

With this type of tenancy agreement, tenants have less protection from eviction as they don’t need to be served a Section 8 or 21 notice in order to be evicted. However, they do have a right to stay until their fixed term comes to an end. This is as long as the rent is paid and they’re maintaining their contractual obligations. A court order may be needed for eviction if this is the case.

Assured and regulated tenancies

You’re unlikely to come across an assured tenancy or regulated agreement, as they usually only apply to tenancies between January 1989 and February 1997.

Making sense of your rental contract

Here is some important advice and guidance to help you make sense of your tenancy agreement.

Read the rental agreement in full and don’t feel pressured

Always take your time to read the full tenancy agreement, and never feel pressured to sign it there and then in the agent’s office. Many agents will present you with the lodger agreement on the day you are due to take occupation and this can add pressure. It’s perfectly acceptable to ask to see a copy of their standard tenancy agreement in advance.

Ask for clarification

Make notes of any clauses you don’t understand and ask the agent to clarify. They have a duty of care to ensure you have fully understood what you’re signing. You can ask to have their clarification in writing if you feel any clause within the lease is ambiguous.

Are the clauses fair?

A tenancy agreement should reflect the obligations of both the tenant and the landlord. Don’t be surprised if there seem to be more clauses in the contract for the tenant to abide by. You’ll be living in and ‘using’ their property so there’s likely to be more clauses for you to adhere to.

Always check whether these are fair. For example, stating you can’t hang washing on the balcony would be deemed a fair request, yet asking you to only use the washing machine at certain restrictive times would be deemed unreasonable.

Additional clauses

Make sure any additional points you’ve agreed with the agent are reflected in the tenancy agreement. These are usually noted on one of the last pages under ‘additional clauses’. An example of this would be agreeing to keep a pet at the property, a dishwasher is provided or the property is repainted before the tenancy begins. The more detailed this information is, the less disappointment you’re likely to feel when moving in.

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Important clauses in a tenancy agreement

These are some of the most important clauses you’re likely to encounter. Make sure these are mentioned in the tenancy agreement you sign.

Section 11

This lists the landlord’s obligations to “maintain the structure and exterior of the property, including installations for the supply of water, gas and electricity, heating systems, drainage and sanitary appliances”.

Section 46 & 47

“Any written demand for rent or other sums payable to the landlord under the tenancy must contain an address for the landlord and not that of the agent.” The address has to be in England or Wales, otherwise the landlord must appoint an agent or managing agent to deal with any issues at the property throughout the term of the tenancy.

Ending the tenancy

How is ending the tenancy dealt with? Do you have a break clause? How is notice to be given by either party?

Deposit protection

How will the deposit be dealt with? It should be held in a protected deposit scheme, so make sure you know the details of this.

Ready to sign your rental agreement?

Once you feel confident you fully understand the tenancy agreement, you’re ready to sign it. Make sure you are clear on your rights and the landlord’s obligations, this will give you peace of mind. It’s time to enjoy living in your new property.

You’ll sign a copy of the agreement to be retained by the landlord, or their agent. You should also receive an identical copy signed by, or on behalf of the landlord.

If you’d like professional assistance renting a property in the UK, there are lots of relocation agents who can assist you. A professional agent will guide you through the minefield of renting in the UK and can make the process as smooth and pleasant as possible – in return for a pre-agreed fee.

Need more rental advice?

Renting isn’t easy. If you need more advice and guidance on the process, from everything to inventories to break clauses, we can help. Browse our rental articles to find expert hints, tips and recommendations. 

Last Updated: September 7th, 2021