What Is an Assured Shorthold Tenancy? [+Free Template]

Assured Shorthold Tenancies (ASTs) have long been the backbone of the UK rental market. Introduced under the Housing Act 1988, an AST provides both landlords and tenants with a balanced, legally binding framework that outlines rights, responsibilities, and essential protections. 

Typically lasting between six and twelve months, ASTs are favoured for their flexibility and the security they offer. Whether you’re a landlord setting up a new rental arrangement or a tenant preparing to move in, understanding ASTs is essential.

Read on to learn about ASTs, the proposed legislative changes via the Renters’ Rights Bill, and how Landlord Studio can help streamline your tenancy management.

Understanding Assured Shorthold Tenancies

An AST is a contract between a landlord and a tenant where the tenant occupies a property as their main home. Under an AST, the landlord rents out a property in which they do not reside, ensuring the tenant has exclusive use of the home. Key aspects of an AST include:

• Fixed-term agreements: Most ASTs begin with a fixed term, usually six or twelve months.
• Periodic tenancies: After the fixed term, the contract can either be renewed or converted into a periodic tenancy, where it rolls over on a month-to-month basis.
• Security deposits: Typically, a deposit equivalent to four or five weeks’ rent is collected and must be protected in a government-approved Tenancy Deposit Scheme (TDS).

Landlords have the right to regain possession of their property after the fixed term using a Section 21 notice, provided they follow the legal requirements. Tenants, meanwhile, benefit from the security of living in a safe and well-maintained property and are entitled to have their deposit returned, minus any lawful deductions.

Download Your Free Assured Shorthold Tenancy Agreement Template

Tenancy Agreement Template.pdf 

Key Features and Responsibilities

AST agreements detail crucial elements such as the rent amount, payment schedule, and duration of the tenancy. They also outline responsibilities for both parties. For example, landlords are required to:

• Ensure the property meets health and safety standards.
• Provide essential documents like the Energy Performance Certificate (EPC), gas safety certificate (if applicable), and the official ‘How to Rent’ guide.
• Protect the tenant’s deposit in an approved scheme and supply information regarding the deposit’s location.

Tenants must pay rent on time, keep the property in good order, and adhere to any conditions stipulated in the agreement. Having a written contract is vital as it clarifies these terms and helps prevent disputes.

Related: Landlord Responsibilities and Legal Obligations

Benefits for Both Parties:

• Legal Clarity: A written agreement sets out all terms, ensuring transparency.
• Protection: Deposits and tenant rights are safeguarded.
• Flexibility: Options to convert fixed-term tenancies into periodic ones allow for smoother transitions.

Setting Up an AST and Managing Documents

Creating a robust tenancy agreement begins with both the landlord and tenant agreeing on key terms. While verbal agreements can be legally binding, written contracts provide clear evidence of the agreed-upon conditions. Here’s how to set up an AST effectively:

1. Drafting the Agreement:

Include details such as:

• Names and contact details of both parties.
• Property address.
• Rent amount, payment dates, and deposit details.
• Duration of the tenancy and conditions for renewal or termination.
  

2. Providing Legal Documentation:

Landlords must supply:

• An EPC.
• A gas safety certificate (if necessary).
• The ‘How to Rent’ guide.
  

3. Protecting the Deposit:

Secure the deposit in a government-approved Tenancy Deposit Scheme within 30 days of receiving it.

Renters’ Rights Bill and Its Impact on Tenancy Agreements

Recent years have seen significant debate over reforming rental law in the UK. The proposed Renters’ Rights Bill aims to enhance tenant security and rebalance landlord-tenant relationships. If enacted, the Bill will have major implications for AST agreements.

Key Proposed Changes

• Abolition of No-Fault Evictions: Under the current system, landlords can regain possession via a Section 21 notice without providing a reason. The Bill proposes to eliminate this, meaning that landlords would need to justify evictions with specific, legally defined grounds (such as rent arrears or breaches of the tenancy).
• Conversion to Periodic Tenancies: Fixed-term ASTs would automatically become periodic, meaning that tenancies continue on a rolling monthly basis until either party gives notice. This provides greater flexibility and security for tenants but requires landlords to adjust their management strategies.
• Revised Notice Periods: Tenants may be able to give two months’ notice to end a tenancy at any time, whereas landlords might face extended notice periods (up to four months) when seeking possession for reasons like selling the property or moving in.
• Regulation of Rent Increases: Rent increases will be limited to once per year and must be communicated via a formal Section 13 notice. The increase must also be in line with current market rates, and tenants will have the right to challenge excessive increases.
• Enhanced Deposit and Document Management: The Bill reinforces the need for landlords to protect deposits and provide all necessary documentation, ensuring transparency and fairness.

Impact on Your Tenancy Agreements

For landlords, these changes mean that existing and new tenancy agreements may need to be revised to reflect new notice periods, possession grounds, and the conversion of fixed terms to periodic tenancies. 

For tenants, the Bill promises increased stability and a clearer process for challenging rent hikes or unjust evictions.

Key Benefits at a Glance:

• For Landlords:
  
  • Increased clarity on possession grounds.
  • Secure storage of all legal documents.
  • Automated reminders for compliance deadlines.
    
• For Tenants:
  
  • Protection against no-fault evictions.
  • Ability to challenge unreasonable rent increases.
  • More secure and flexible tenancy arrangements.

Using Landlord Studio to Streamline Tenancy Management

Managing multiple tenancies while staying compliant with evolving legislation can be challenging. Landlord Studio is a property management and accounting software that offers a range of features specifically designed to help landlords stay organised and compliant:

• Centralised Document Storage: Store all your tenancy agreements, certificates, and correspondence in a secure cloud-based system. 
• Rent Tracking and Notifications: Track rent payments, set up automated rent reminders to chase late rent, and generate comprehensive rent reports.
• Maintenance and Repair Tracking: Allow tenants to make maintenance requests online and track, prioritise, and schedule jobs with ease. 
• Compliance Alerts: Set personal reminders and receive notifications for upcoming deadlines such as certificate renewals, tenancy end dates, and rent increase notice periods. 
• Integrated Calendar and Task Management: Plan out your property management tasks with a built-in calendar.

Create your free Landlord Studio account today to find out more.

Final Words: Assured Shorthold Tenancies

Assured Shorthold Tenancies have long provided a structured yet flexible framework for renting in the UK. However, the proposed changes from the Renters’ Rights Bill mean significant transformations are on the horizon.

Modern property management solutions like Landlord Studio can make the transition smoother by centralising documents, automating compliance alerts, and streamlining rent collection. Ensure legal compliance and enhance the overall efficiency of your buy-to-let business.

If you’re looking to stay ahead of these regulatory changes, download our free AST template today and consider how Landlord Studio can support your property management needs.

Download Your Free Assured Shorthold Tenancy Agreement Template

Tenancy Agreement Template.pdf 

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