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What are the changes to Assured Shorthold Tenancies?

What are the changes to Assured Shorthold Tenancies?

Over the last two and a half decades, Assured Shorthold Tenancies, popularly known as the ASTs have been a common, pre-defined and legitimate type of tenancy across homeowners and tenants based in Wales and England.

However, the AST, as we know, is on the verge of a massive transformation.

Here’s what’s going to change: 

  • Wales will follow the Renting Homes Act and every new home-based contract will fall under it starting 1st December. 
  • Even though no official confirmation has been heard from England, the government recently introduced a white paper for the reformation of existing rental laws. This is likely to affect existing and new rental agreements. 
  • England and Wales are now prioritizing tenant security and thus coming up with amended laws to reflect the same.

Having said that, what is the current law about tenancy, and what is the usual eviction process if the resident has followed the rental agreement? 

Two things are important to note here: 

  • Neither England nor Wales legally mandates a written agreement for the tenancy (even though we recommend it).
  • Neither of the parties including the resident or the homeowner can sever the AST for the predefined fixed term which is usually half a year.
  • Homeowners cannot ask a resident to leave the premises within the first 180 regardless of a predefined agreement.
  • Homeowners cannot give an eviction notice following the fixed term without providing a valid reason that abides by the section 21 notice. The resident deserves a 60 days notice in advance. 
  • Following a fixed term, a resident can leave the premises with a 30-day notice.

What’s going to be different from 1st December 2022?

  • The AST will no longer be in place and instead be operated as an ‘occupation contract’ where the resident gets the right of a ‘contract holder’.
  • All homeowners will mandatorily need to provide legally sound written rental contracts. 
  • The contacts may be a fixed term of one or over seven years. Alternatively, it may also be periodic. 
  • Every contract holder should receive a 180-day notice from the homeowner and this needs to be after the first predefined 180 days of the contract. In the simplest terms, homeowners are expected to commit for at least 12 months. 
  • Periodic contracts can have a four-week notice from the renter at any point. 

Potential rental options in England

  • Tenancies will be completely periodic, meaning the state will do away with predefined terms. 
  • Evictions need to be justified with proper proof and the Section 21 will no longer be in place. 
  • Renters can provide a 60-day notice to the homeowner at any point during their stay. 

Having said that, these proposals are likely to change, even more so, because England has recently inaugurated their Prime Minister.

In 2017, we witnessed a similar rental amendment via the Private Residential Tenancy, where the primary goal was to dissuade homeowners from evicting renters without any reason. Additionally, the following goals came to the effect: 

  • Open-ended agreements with no pre-defined terms
  • Homeowners need to specify at least one among the 18 available reasons for eviction 
  • Renter should receive a 28-day notice if they resided in the property for less than 180 days and an 84 days notification if they resided for 180+ days
  • Renters can leave a property with a 28 days’ notice