Q&A: If an assured tenant signs a new tenancy agreement, does it remain an assured tenancy or become an assured shorthold tenancy?
Section 19A of the Housing Act 1988 (HA 1988) provides that an assured tenancy entered into after the day section 96 of the Housing Act 1996 came into force (28 February 1997) is automatically an assured shorthold tenancy. For this reason the vast majority of new tenancies entered into in England are assured shorthold tenancies. HA 1988, s 19A is however subject to the exceptions in HA 1988, Sch 2A.
HA 1988, Sch 2A, para 7(1), provides that an exemption to the automatic application of assured shorthold tenancies is where an assured tenancy is granted to someone who immediately before the grant of the tenancy held an assured tenancy, either alone or jointly with others. This is subject to the requirement that the landlord remains the same, though again in cases where there are joint landlords it is sufficient that only one of the landlords was the landlord under the old tenancy.
This means that a tenant renewing their tenancy of the same premises with the same landlord will not be required to take a tenancy with weaker security of tenure provisions (HA 1988, s 21 does not apply to assured tenancies) as a result of HA 1988, s 19A. If a joint tenant moves out, then the remaining tenant will not lose their right to an assured tenancy.
The other requirement for the exemption set out in HA 1988, Sch 2A, para 7(1) to apply is that no notice is served pursuant to HA 1988, Sch 2A, para 7(2). This notice must be served before the assured tenancy is to be entered into, must be served by the tenant(s) on the landlord(s) (if there are joint landlords, service on one is sufficient) and state that the tenant(s) wants the new tenancy to be an assured shorthold tenancy.
If no notice is served, then provided that the tenancy is of the same premises as the previous assured tenancy and at least one of the tenants and the landlords are the same, then the tenancy will not be an assured shorthold tenancy. It is important to note the requirement that the tenant must have held an assured tenancy 'immediately' before the grant of the new tenancy. A short delay may be enough to mean that the exemption is not applicable.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.