Moving away from ASTs north of the border?

by Readers Question

13:40 PM, 6th June 2016
About 2 years ago

Moving away from ASTs north of the border?

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Moving away from ASTs north of the border?

We north of the border are moving away from Assured and SAT s to no term agreements. Tenant can up and leave with 28 days notice. No 6 month leases, no 1 year leases to give the landlord piece of mind, nothing. . We have to be at the whim of the tenant to up and leave. past future

You could spend £000s on a property and a tenant could be in your property for 1 month – a neat short let at below short let rates because the representation was ‘ we are looking for a long stay’ and hey presto 28 days notice on the day they move in ! 90% of landlords here have not picked up on the underhanded amendment at the second stage of the bill – now passed. The rationale being – check this, in case someone is living in a abusive domestic relationship !

The whole Private Rented Sector up here has been arranged around that scenario ! I am still getting my mind around the rest of the bill although selling up is now on the radar.

Anyway the question is – can I have in an agreement (using current SAT s as an example) a discount element for long (er) term occupancy ? i.e. The rent is say £600 PCM with last months rent free as an incentive to take up the occupancy ?

Would that fly ?

Asif



Comments

Rod Adams

9:54 AM, 7th June 2016
About 2 years ago

Hi Asif,

Section 49, clause 3 states:

(3)In subsection (1)(c), “the minimum notice period” means a period which—
(a)begins on the day the notice is received by the landlord, and
(b)ends on the day falling—
(i)such number of days after it begins as the landlord and tenant have validly agreed between them, or
(ii)if there is no such valid agreement, 28 days after it begins.

So my understanding is that the notice period is only 28 days if no alternative has been previously agreed i.e. in the lease conditions. That is however a layman's interpretation and I'm open to correction.

Regards,

Rod.

Mandy Thomson

10:55 AM, 7th June 2016
About 2 years ago

I don't buy the domestic abuse excuse because, at least in England, there is legal protection for an abused partner. For example, they can apply to the court for an occupation order (which allows them to live in the property for a time and excludes the partner), even if their partner owns the property outright and they have no other legal claim to it.

AA

16:12 PM, 7th June 2016
About 2 years ago

Reply to the comment left by "Rod Adams" at "07/06/2016 - 09:54":

Hi Rod - are your observations on the Scottish bill that has just gone through or previous housing acts ? Scotland's move towards no term agreements means possibly longer void periods as Edinburgh and Aberdeen are predominantly student markets. The idea is incorporate into rent during the occupancy the expected loss of rent of the expected void period. The free months if taken up is the incentive to the occupancy as for the tenant the average cost over the period is less. The agreement, a standard document I would imagine, specific to my suggestion would read " rent is X for months 1 -9, peppercorn rent months 10 - 12, (as the no fault termination is not allowed, ) reverts to X plus CPI for next 9 months ..." and so on. :...depressing or what ?

AA

16:21 PM, 7th June 2016
About 2 years ago

Reply to the comment left by "Mandy Thomson" at "07/06/2016 - 10:55":

Cited reason in the reporting. But they are politicians, any excuse will do.

Rod Adams

10:59 AM, 8th June 2016
About 2 years ago

Reply to the comment left by "Asif Ahmed" at "07/06/2016 - 16:12":

Hi Asif,

My comment was based on the final version of the act which was passed by parliament on 17/3/16. Another potential way round may be to set the notice period to the duration of the tenancy and have this decreasing as the tenancy progresses. i.e. for a 6 months tenancy the notice period is 183 days, diminishing by a day for each day of the tenancy which elapses down to a minimum of 28 days. Whether this or your proposed solution are within the legislation remains to be seen!

Regards,
Rod.

Romain Garcin

11:53 AM, 8th June 2016
About 2 years ago

I'm no expert but it seems that it may not be possible to agree to a notice period in the tenancy agreement because of s.49(4)(b):

"An agreement as to the number of days after which a minimum notice period ends is invalid for the purpose of subsection (3)(b)(i) if the agreement was entered into before the tenancy became a private residential tenancy."

Which I interpret as meaning that a minimum tenancy period other than 28 days can only be agreed AFTER the tenancy has started, at which point it may be difficult to convince the tenant.

A solution might be to collect as much rent as possible upfront by e.g. setting the first month(s) rent much higher than the following months.

AA

15:39 PM, 8th June 2016
About 2 years ago

Reply to the comment left by "Romain Garcin" at "08/06/2016 - 11:53":

Hi Romain, that's what I was thinking. Establish the duration of the education programme, say 9 months, average rent over 12 months is £450 pcm payable over the first nine months.at £600pcm. At no point is the 28 day notice period contested. The flip side is nobody is locked in and therefore there maybe introduced fluidity in the market. Only time will tell. Is it not great we occupy a place in society akin to any social pariah you care to mention. I thought I was exercising self responsibility and not be a burden to the state ...

AA

8:36 AM, 9th June 2016
About 2 years ago

Reply to the comment left by "Romain Garcin" at "08/06/2016 - 11:53":

Hi Romaine re Section 49 (4) b and Subsection 3 (b) 1 As you state
Precludes "before" a PR tenancy is created.
What s you view on if the notice period is "ON" the date a PR tenancy is created ?

Romain Garcin

9:14 AM, 9th June 2016
About 2 years ago

Reply to the comment left by "Asif Ahmed" at "09/06/2016 - 08:36":

As said I am not expert, but I cannot see how the initial terms of the tenancy could be agreed after the tenancy has been created.

If you agree to a new notice period on the day the tenancy is created it may be fine as long as it is done in a separate document.

Rod Adams

9:15 AM, 9th June 2016
About 2 years ago

It could be interpreted that if a clause is in the lease which sets out a notice period duration then that is not agreed before the lease is created but is agreed when the lease is created.

Although that does raise the question as to what the circumstances would be where a notice period was agreed before the lease was created and hence the purpose of this clause in the legislation?

Clear as mud!

Regards,

Rod.

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