Thinking out of the box or garage?

Thinking out of the box or garage?

by Readers Question

Guest Author

8:55 AM, 5th July 2016, About 8 years ago 10

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I would like to ask the views and tap into the wealth and experience held within the property 118. I am planning on renting out a block of 4 garages which I see as a small investment with some good returns over time.garage

My idea is to take a deposit on each garage using My deposits web site, and get the tenants to sign a AST or a rental agreement. At this point I’m unclear of what to do any advice would be good. I have chosen to put the garages into a ltd company to allow me some tax advantages, and also financially distance myself from a unknown risk of renting these type of units out.

The rent will be paid each week.

I hope you guys can help.

kind regards


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Neil Patterson

9:00 AM, 5th July 2016, About 8 years ago

Hi Mark,

We have two recent articles on this subject for your reference



This will not be an AST though. Please see the .Gov site definitions below:

Assured shorthold tenancies (ASTs)

The most common form of tenancy is an AST. Most new tenancies are automatically this type.

A tenancy can be an AST if all of the following apply:

you’re a private landlord or housing association
the tenancy started on or after 15 January 1989
the property is your tenants’ main accommodation
you don’t live in the property

A tenancy can’t be an AST if:

it began or was agreed before 15 January 1989
the rent is more than £100,000 a year
the rent is less than £250 a year (less than £1,000 in London)
it’s a business tenancy or tenancy of licensed premises
it’s a holiday let
the landlord is a local council

Other tenancies

There are other tenancies that aren’t as common as ASTs, including:

excluded tenancies or licences
assured tenancies
regulated tenancies

Excluded tenancies or licences

If you have a lodger living in your home and share rooms with them, like a kitchen or bathroom, you may have one of these. This usually gives your lodger less protection from eviction than other types of agreement.

terry sullivan

12:49 PM, 5th July 2016, About 8 years ago

Ltd Company? seems like a lot of hassle for such an investment

rent is as agreed--no ast

Graham Bowcock

12:53 PM, 5th July 2016, About 8 years ago

Dear Mark

There is certainly demand for garage lettings, presumably in line with the demand for self storage.

I agree with Neil that such lettings are certainly not covered by AST agreements. you need a simple licence agreement and make sure that the user is purely domestic and not running a business. You should check from time to time that they are not being used for the storage of rubbish or waste as it can cost a lot to get them cleared when the tenants disappear.



Mark Dotford

13:09 PM, 5th July 2016, About 8 years ago

Reply to the comment left by "terry sullivan" at "05/07/2016 - 12:49":

The ltd company wasn't to bad to set up and run just a paper work exercise, it helps with reducing my tax liability. It's only s small income granted but 5k is a nice holiday a year. The yield isn't to bad either at 14% minus running costs, Thank you though I wont go down the AST route.

Mark Dotford

13:13 PM, 5th July 2016, About 8 years ago

Reply to the comment left by "Graham Bowcock" at "05/07/2016 - 12:53":

Thank you Graham, I haven't completed on the sale yet, I have placed an advert in gumtree, and have been overwhelmed with enquires clearly some will be time wasters, I was going to take a deposit for each garage. Which should cover any rubbish if left. The deposit was going to be held with my deposits web site.

Graham Bowcock

14:02 PM, 5th July 2016, About 8 years ago

Reply to the comment left by "Mark Dotford" at "05/07/2016 - 13:13":


There is no need to protect the deposits. Deposit protection only applies to ASTs.


Mark Alexander - Founder of Property118

14:13 PM, 5th July 2016, About 8 years ago

I agree on the point of no requirement to protect deposits.

The type of agreement required is a licence, not an AST.

Mark Dotford

16:31 PM, 5th July 2016, About 8 years ago

Reply to the comment left by "Graham Bowcock" at "05/07/2016 - 14:02":

Thank you for your feed back Graham..

Mark Dotford

19:58 PM, 5th July 2016, About 8 years ago

Reply to the comment left by "Mark Alexander" at "05/07/2016 - 14:13":

Thank you Mark, less paperwork lovely.

Julie Kirby

7:23 AM, 25th April 2018, About 6 years ago

Having rented out a garage hassle free for 10 years the current tenant has stopped paying and left her partner's wrecked car in it. Police have confirmed from the VIN number that it is indeed their car (no plates) and not stolen. Does anyone have any idea how to gain possession? I have the tenant's address, copy of driving licence and bank statement plus working email address but phone number has been changed.

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