A licence for sharers?

by Readers Question

21:56 PM, 5th July 2013
About 7 years ago

A licence for sharers?

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A licence for sharers?

I rent a house to sharers. The tenants’ rent is all inclusive. It is an unlicensed HMO.

Historical each individual tenant has had an ast signed and deposit held, and in some cases, “protected”.

I am careful when selecting new housemates and (so far) have had no trouble. I have always returned deposits quickly.

Can I amend the ast to call it a license agreement and therefore not have to protect their deposits?

Thanks for your advice.

Gavin Pearson A licence for sharers?


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Comments

Mark Alexander

10:36 AM, 6th July 2013
About 7 years ago

Hi Gavin

I am a bit confused.

Are you a resident landlord? In other words, is the property you are referring to the one you live in?

If not, why do only some of your tenants have their deposits protected and not others? Same for AST’s

You can call your tenancy agreement anything you like but it is what the law determines the tenancy to be which makes the difference, hence my questions above. Calling a tenancy agreement a licence, a contract or lease makes absolutely no difference to the rights of a tenant.

Gavin Pearson

11:28 AM, 6th July 2013
About 7 years ago

Hi Mark

I do not live there. The house is full with 4 singles on separate agreements.

Setting up with the DPS only seems to recognise and want a lead tenant. That tenant is then responsible and this would not be fair on that individual. I have never managed to have more than one tenant with a protected deposit at any one time. One of them has been there since the beginning and I have never held a deposit for him.

I thought the license agreement idea would save me the hassle not remove the tenants rights.

Regards

Gavin

Mark Alexander

17:07 PM, 6th July 2013
About 7 years ago

Reply to the comment left by "Gavin" at "06/07/2013 - 11:28":

Hi Gavin

I still don't really understand what you are doing in terms of deposit protection, can you explain please?

If I am reading you correctly, there are currently 4 tenants?

Do all four have separate AST's?

How many of them paid a deposit?

Did you protect each of those deposits?

Is this property the primary residence for each of these tenants?

If the answer to my last question is NO, then you may be able to offer licences to those tenants.

Otherwise, it's AST's with the full protection of the law, including deposits if the tenants pay them.

Gavin Pearson

19:14 PM, 6th July 2013
About 7 years ago

Reply to the comment left by "Mark" at "06/07/2013 - 17:07":
Hi mark,
Sorry to confuse you twice in one day.
the tennents are using this as their primarary residence so full AST it is.

I just don't see the point in the protection. I've never withheld a deposit in 5 or 6 years. I'd prefer not to have one.
Has the "two months rent in advance" or does the law still consider that to be a deposit?
Thanks for the answers
Gavin

Mark Alexander

21:06 PM, 6th July 2013
About 7 years ago

Reply to the comment left by "Gavin" at "06/07/2013 - 19:14":

Hi Gavin

If you take two months up front, then charge monthly, one months rent is considered to be a deposit. If you don't protect that deposit within 30 days you can't serve a section 21 notice until you give the money back. You will also be liable to a fine of up to 3 times the deposit. If you are paid two months rent every two months and take two months up front that's not considered to be a deposit. Does that make sense now?

Mark Alexander

21:13 PM, 6th July 2013
About 7 years ago

PS - the case law was very recent "Johnson vs Old". If you are really sad you might want to read this >>> http://www.bailii.org/ew/cases/EWCA/Civ/2013/415.html


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