Granting an ordinary lease?

by Readers Question

10:08 AM, 10th September 2018
About 3 months ago

Granting an ordinary lease?

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Granting an ordinary lease?

This may sound like a strange question amidst the climate of all the stuff going on to provide security for tenants by lengthening AST agreements with associated caveats for tenants benefit contrary to most landlords’ legitimate interests. However, I would welcome advice re the following.

My elderly brother has been offered a long term let of a flat that suits him nicely and which he can well afford. The flat owner wishes to let long term and I’m sure is genuine. My brother will wish to probably remain in the flat until he dies which means at least ten years hopefully more.

My question is can the letting be covered by an ordinary lease rather than an AST obviously with break clauses, rent reviews etc so he can remain there safely without having notice to quit served on him provided of course he adheres to the covenants which he obviously will.

Many thanks

Richard



Comments

David Price

11:23 AM, 10th September 2018
About 3 months ago

I believe that all tenancies are automatically AST's these days, even if they purport not to be.

Ian Narbeth

11:38 AM, 10th September 2018
About 3 months ago

Richard
There is nothing to stop your brother having a long tenancy, terminable on your brother's death or sooner if he gives notice, e.g. if he has to go into a nursing home. Tenancies over 3 years must be executed as deeds and tenancies over 7 years must be registered at HM Land Registry. Be aware that if the tenancy is over 7 years, the landlord's repairing obligations under the 1985 Landlord and Tenant Act don't apply.

I would suggest fixed increase rent reviews or increases linked to RPI or CPI (the latter is better for tenants) so your brother does not face massive rent hikes.

There can be tax advantages for landlords when there is a long lease in place.

Graham Bowcock

11:51 AM, 10th September 2018
About 3 months ago

Richard
If the letting of a house to an individual or groups of individuals (as opposed to a company) then it will be an Assured Shorthold Tenancy by default, it does not matter what you call it. There is an interesting law case called Street v Mountford which deals with the naming of tenancy agreements and the judge used the following fantastic phrase:
"The manufacture of a five pronged implement for manual digging results in a fork even if the manufacturer, unfamiliar with the English language, insists that he intended to make and has made a spade."
Says it all really.

As Ian said, your brother could take a long term tenancy. The main risk is probably for the landlord rather than your brother, although he would need to have a break clause and fair rent review provisions.
Graham

Richard Adams

12:08 PM, 10th September 2018
About 3 months ago

I am truly grateful for the wise advice received. I was most certainly not aware of some of points mentioned although believing what I suggested would likely be possible. Particularly well worth being aware, as I was not, that a tenancy of over seven years absolves the landlord of his repairing obligations. I wonder how many landlords & tenants know that? This forum proves the old adage that it is not what you know but who you know that often counts these days. Thank you.

Ian Narbeth

12:13 PM, 10th September 2018
About 3 months ago

Reply to the comment left by Richard Adams at 10/09/2018 - 12:08
Hi Richard
There may be ways around the 7 year problem. A solicitor could advise and your brother would have to incur some fees but in the context of a long lease, he may be willing to do so.

Richard Adams

12:17 PM, 10th September 2018
About 3 months ago

Reply to the comment left by Ian Narbeth at 10/09/2018 - 12:13
Thanks Ian. Noted what you say.


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