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The Different Types of Tenancy Agreements

9 November 2020 Simon Banks Read time: 3 min
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Simon Banks

The tenancy agreement is kind of a big deal. After all, it only outlines the entire terms of your stay in the home, as well as the duration you live there for. Whether you’re a first-time renter or this is your first move, you’re going to need some form of a rental agreement.

But did you know there are several types of rental contracts? From assured tenancy shorthold (AST) to a company let, there’s more than one way to rent a home. Which is why we’ve put this handy guide together detailing everything you need to know about the different types of tenancy agreements.

Why you need a tenancy agreement

There’s no legal requirement that says you must a tenancy agreement. But entering into a written contract offers both yourself and the landlord protection. This is especially handy if the landlord takes a deposit from you before the move.

Person signing a tenancy agreement

The rental agreement is an implementation of your rights on paper, setting out a series of expectations for the tenancy. These will include the length of the tenancy, as well as elements like if or not you can sublet the home.

What to expect in a tenancy agreement

Not all tenancy agreements are the same, and there are different contract types available (we’ll get to that shortly). But there are a few things that you can expect to find in a standard tenancy agreement. These include:

  • Property address
  • Landlord’s address and contact details
  • Amount of rent due
  • How it will be paid
  • Deposit amount
  • Deposit protection scheme
  • Terms of contract
  • Notice periods for landlords and renters
  • Rights and obligations on both sides
  • Clauses that allow repossession of the property if you break the terms
  • Special arrangements, such subletting and if you can bring your little furry friends

Choosing the right tenancy agreement

The type of tenancy agreement you use will depend on a few factors. These include the initial length of your stay, whether you’re renting as part of a company and the type of contract proposed by the landlord. If you’re unsure about your options, here are the different types of tenancy agreements you can expect.

Assured shorthold tenancy

The overwhelming majority of renters will have an assured shorthold tenancy (AST) when they move into a rental home. The AST is by far the most common type of rental contract between a landlord and renters and typically lasts for 12 months. Some tenancies may also contain a six-month break clause, which allows you or the landlord to end the terms early. ASTs are also used for short-term lettings.

Statutory periodic tenancy

There are generally two options once an AST expires: renew the terms or let it roll onto a statutory periodic tenancy (SPT). The SPT keeps the same terms as the initial tenancy and goes onto a rolling contract. You only need to provide one month’s notice if you plan to leave during the SPT, while landlords must provide two month’s notice.

Excluded tenancy

Now we’re getting into the realm of the  tenancy types. An Excluded tenancy may come into effect if the landlord is only renting out a room in the property while still living in the rest of the house. You won’t have the same protections with an excluded tenancy, and the landlord doesn’t need to protect your deposit. It’s also possible for the landlord to evict you without a court order.

Regulated tenancy

Before the AST came into effect in 1989, regulated tenancies were all the rage. These days, they’re nowhere near as common but do still exist. Essentially, a regulated tenancy is a long-term tenancy where renters are entities to fair rent set by the Valuation Office Agency.

Company let

If you’re renting your home through a company, you may live in your new place with a company let. Your place of work should sort everything out on your behalf, but a company let essentially means the landlord’s contract is with your employers, who will also handle things like deposits.

Tenancy at will

There is no contract involved with a tenancy-at-will, and the landlord or renter can terminate the agreement at any time. You’re unlikely to have a written agreement in place, and there is no specified length for the tenancy. Renters who want flexibility and don’t want to commit to a long-term contract may prefer using a tenancy-at-will.

Know your AST from your SPT

Whether you’re looking for a forever home or somewhere to live while on a work contract, it’s handy to have a good grasp of the different types of contracts. No matter the one you use for your move, ensure that you have thoroughly read and understood it before signing on the dotted line. Once you’ve signed your contract, you can look forward to moving into your new humble abode.

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