The UK Government Thursday released its promised new model tenancy agreement – the Assured Shorthold Tenancy (AST).
Designed for landlords’ use free of charge it is intended for use in England and Wales and particularly when landlords and their tenants want to enter into a longer term tenancy.
The usual AST tenancy length is 6 or 12 months and most landlords let for six months initially until the tenant has been proven reliable – sort of a probationary period. An alternative is a 12 month agreement with a six-month break clause.
This will introduce a new concept – a voluntary arrangement for the tenancy to be longer.
The model agreement will be particularly relevant for use when the parties are entering into a longer term tenancy of 2 or more years. It, therefore, contains provisions relating to rent reviews and those which enable the landlord or the tenant to end the tenancy during the fixed term if their circumstances change.
The 38 page model agreement can be completed online and downloaded for hand writing free of charge for the Department for Communities and Local Government DCLG website.
The new facility for landlords was announced by Brandon Lewis at the Newport RESI conference and is an obvious move to pre-empt the opposition’s policy of introducing a compulsory 3-year tenancy regime for private sector tenancies.
The agreement is accompanied by a guide for landlords and tenants and the agreement itself includes a detailed checklist to remind both parties of key points and dates.
Important issues like notice periods for possession, break clauses, rent reviews and how to increase the length from a standard agreement are covered.
The coalition’s view is that increasing the length of a tenancy should be a matter of agreement between landlord and tenant and not a compulsory edict from government.
This is based on the principle that most tenants want flexibility in the arrangement, with the majority leaving after 12 months or less. For those that require a longer term settled tenancy offering them additional security, the Government see it that this can be agreed between the parties.
Announcing this launch, the minister emphasised that by far the majority of tenancies progress perfectly amicably with high levels of satisfaction in the private rented sector. He did not see the need for further legislation to bring in additional red tape regulations which will make the life of landlords more difficult.
This he thought would discourage investment and result in increased rent costs for tenants, which to-date, contrary to popular belief, have been increasing at below the rate of inflation, even in London.
Two copies of the agreement should be made – 1 for the landlord, the other for the tenant. It is the responsibility of either party to keep the agreement in a safe place as it will need to be referred to during the tenancy.
The use of the model is entirely voluntary. There is no legal requirement to use the agreement but landlords and tenants will be able use it with confidence.
You can find the new agreement and guide here:
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