Assured Shorthold Tenancies: Housing Act Update

Prior to the recent General Election and before Parliament was dissolved, the coalition Government passed significant legislation.  Some of which is likely to be of interest to both Landlords and their agents, who may welcome an outline of these changes:

Tenancy Deposits:

If the deposit has not yet been protected, the landlord now has a period of 90 days from 26 March 2015 (or before the Court hearing to determine a tenant’s claim for compensation or to determine the landlord’s claim for possession under section 21, whichever is the earlier) to protect the deposit and to serve the prescribed information.

If the deposit has been protected and the prescribed information was served at the outset, provided the deposit remains the same with the same scheme, the landlord will be treated as having complied with the legal requirements.  There is then no need to re-protect the deposit and/or re-serve the prescribed information on renewal or roll-over into a period tenancy.

It has now been formally enacted that agents can sign and serve the prescribed information on behalf of the landlord.  If the deposit has never been protected at all, the Act doesn’t change the landlord’s liability.

Section 21 Notices  (since 26 March 2015)

The date of expiry of a notice under section 21(4)(a) of the Housing Act, 1988 is no longer required to be the last day of a period of the tenancy.

A section 21 notice cannot now be given during the first 4 months of a tenant’s occupation under a tenancy agreement.  This gives the tenant the same 6 month security of tenure but makes timing of the notice trickier where possession is required at the end of a 6 month term.

A section 21 notice will only have a shelf life of 6 months after which no possession claim can be issued in reliance on it.  It is possible that a future Secretary of State may require landlords to use a prescribed form for section 21 notices.

In the event that a tenant has paid rent in advance but a section 21 notice is subsequently served requiring the tenant to give up possession of the property during the period that the rent payment covers, the landlord may have to repay a daily apportionment of advance rent.

The new legislation contains provisions, which would prevent the retaliatory eviction of tenants following orders being made by the local authority relating to disrepair at rental properties.

For more information on this or any other aspect of Commercial Law, please contact a member of our Commercial team.  

Please note - these notes are for guidance only and should not be relied upon as being legal advice.