The current underpinning law for renting a home in England is very complicated and has resulted from many years of development and legal amendments to residential tenancies law through case law and statute.
The laws in Wales, Scotland, Northern and Southern Ireland are either the same or similar, but in some if not all of these jurisdictions, mainly as a result of devolution and separate parliaments; these laws are currently undergoing some sweeping changes.
Tenancy law is based on a combination of:
1. Common Law or judge made law
2. The Law of Contract
3. Statute or Parliament made rules
In general, common law can be over-ridden by contract (agreements made by the parties) and again by statute. Acts of Parliament such as the Housing Acts, introduce rules which cannot be over-ridden.
On a case by case basis these rules are applied when cases come to court and decisions are made by judges and by higher courts which act as precincts for similar cases in the future. It often takes years and hundreds of cases for rules to be tried and tested and amendments to the law and decisions made which give clear guidance.
As the law becomes more and more complex, as it has over time, inevitably calls are made for a simplification in the law, as is the case at present mainly in Wales and Scotland. It’s almost inevitable though that the simplified rules will again come under scrutiny, with revisions and amendments made over the coming years.
There are many different possible residential tenancy types in England but only one that is common for use by buy-to-let landlords. The following list of statutory tenancies which currently exist in England:
(a) Assured Shorthold Tenancies (AST): This is the default tenancy for private renting and one type of Assured Tenancy – see below. In other words, under normal circumstances, where a landlord lets to a private tenant, even without a written agreement (which is perfectly legal), the tenancy will automatically be an AST and will come under the Housing Act rules.
The AST gives tenants a limited amount of security and gives landlords the assurance they can get their property back if they want it. Tenants are guaranteed a minimum tenancy of 6 months unless the parties have contracted to a longer period, but the tenant is subject to a no fault 2 months’ notice which can result in repossession, usually within a period of 3 months after applying to the courts for a Possession Order if the tenant disputes the eviction.
The AST, following its introduction by the Housing Act 1988, many argue, helped open up the UK rental market and resulted in the growth of private rented sector (PRS) from around 8% of households in 1900 to around 18% of the market today – February 2015.
Housing associations also use ASTs in the social housing sector as the equivalent to introductory and Demoted Tenancies see below.
(b) Assured Tenancies (AT): Assured tenancies were introduced by the Housing Act 1988. They give tenants a high degree of security of tenure and are similar, but not identical, to Secure Tenancies – see below. They are mainly used by housing associations, but also by some private landlords.
As with ASTs during a fixed term tenancy, tenants cannot be removed unless they have breached their tenancy conditions and then only under certain Grounds for Possession under section 8 schedule 2 of the Housing Act 1988.
(c) Rent Act Tenancies: These are tenancies created before the Housing Act 1988 came into force on 15 January 1989. As with secure and assured tenants, Rent Act tenants give a high degree of security of tenure. In fact tenants have security for life and rents are fixed and rent increases severely restricted. Housing association tenancies created before 1989 are treated as Rent Act tenancies for the purpose of fair rent regulation.
(d) Common Law Tenancies: These are tenancies not covered by statutory rules such as the Housing Acts, although basic Protection from Eviction Act 1977 rules can apply. They are based on Common Law and contract law and apply where a company rents a residential house (usually on behalf of an employee) or where the landlord lives in the same building (not a purpose building block of flats) as the tenant. Tenants have less security of tenure than Housing Act tenants and are subject to a Notice to Quit where one is served, at the end of their contract term.
(e) Licence Strictly speaking a licence is not a tenancy (which gives legal rights to the land) at all but a merely licence to occupy. A lodger has a right to occupy only and does not have exclusive possession. Whereas a tenant can exclude everyone from their home including their landlord, a lodger lives with the landlord, sharing facilities, and no part of the building is exclusive to them. Lodgers should not have a lock on their room and the landlord should have freedom of entry, for cleaning etc.
All of the following tenancies apply to social housing:
(f) Secure Tenancies: This form of tenancy provides long-term security of tenure and can now only be offered by a local authority. Tenancies created by housing associations between 1980 and 1989 have a dual legal status, being both secure tenancies and Rent Act tenancies (for rent regulation purposes). Additionally, a licence given by a local authority can also be a secure tenancy (or, if applicable, an introductory tenancy).
(g) Introductory Tenancies: Introductory tenancies are also specific to local authorities. Once adopted by an authority, all new tenancies must be introductory, irrespective of whether such a tenancy is really appropriate for a particular tenant. Introductory tenancies usually last for a year, after which they become Secure Tenancies. During the introductory period the tenant is at risk of mandatory eviction if they do not meet certain conditions.
(h) Demoted Tenancies: These were introduced by the Anti-Social Behaviour Act 2003 and apply only to local authority tenants. They are created by a court order changing a secure tenancy to a Demoted Tenancy. During the demotion period, which usually lasts a year, the tenant is at risk of mandatory eviction.
(i) Family Intervention Tenancies: These tenancies were introduced by the Housing and Regeneration Act 2008 and relate to the provision of anti-social behaviour support services. They are designed to be used where households have been relocated to enable intensive support to be provided. As with demoted tenancies, the tenants are at risk of mandatory eviction.
Following several legal and parliamentary reviews of the Private Rented Sector (PRS) in England, changes to the tenancy laws are being called for. So far this has not come about, but watch this space!©LandlordZONE® – legal content applies primarily to England and is not a definitive statement of the law, always seek professional advice.