Last week the Scottish Government released the new tenancy for the private rented sector.
We currently use Short Assured Tenancies (SATs) for all of our tenancies and from the 1st of December 2017 all new private rented tenancies in Scotland will be Private Rented Tenancies (PRTs).
Why are private tenancies changing?
Scottish Government is bringing tenancy law and documentation in Scotland up to date. The private rented sector in Scotland has changed significantly since the 80s when SATs were introduced.
Most noticeably, the new PRT is much easier to understand than the outdated SAT. If anyone reading this knows what an AT5 or an “ish date” is then you’ll be delighted to hear they are gone from the new PRT – hoorah! The PRT also includes a few rule changes that are aimed at providing tenants with greater security of tenure whilst also giving landlords greater flexibility if their circumstances change or the tenant is in breach of their lease.
I’m currently a private landlord or tenant. Should I be worried?
No. Current tenancies (SATs) will remain SATs after the 1st of December and until the tenancy comes to an end or the lease is renewed.
Ok, so let’s hear the details…
The key changes for landlords and tenants to be aware of for their next tenancy that begins after the 1st of December:
- Tenancy agreements have a start date but will no longer have an end date or an initial period. This means that a landlord or tenant can serve notice to end their tenancy at any point. Previously they had to wait until the end of the initial period of the lease (at least 6 months). In general, tenancy lengths are increasing with the average tenancy length now over two years however there will be the odd occasion where a tenants’ circumstances change after only a short time in a property. At the moment, tenants must meet the obligations of the lease until the landlord agrees to release them (usually when a replacement tenant moves in) or their initial period comes to an end but this will change as the tenant will have no initial term obligation – only the 28-day notice period.
- Dates of student tenancies will change. As there is no longer a fixed initial period in a lease, I expect there will be an industry-wide change to the way student tenancies run where they start in July and end in June instead of September to August. This will not become apparent until Summer 2019 (just under two years from now) since tenancies this year will continue to adhere to the current SAT fixed lengths rather than the new PRT rules. We’ll have to wait for 2018/19’s students to vacate to see the effect the new rules will have.
- Notice periods are changing. Under PRTs, tenants only have to serve 28 days’ notice to bring a tenancy to an end. Landlords can serve 28 days’ notice to end a tenancy in the first six months but after that the landlord notice period goes up to 12 weeks. This deliberately gives the tenant more notice and greater flexibility than the landlord. This is part of improving security of tenure for tenants.
- Tenancies can no longer be ended by the landlord for no reason. Under the current SAT rules, a landlord can end a tenancy at the end of the initial period without providing a reason. With the new PRT, a landlord will only be able to bring a tenancy to an end if the tenant breaks a condition of the lease or if the landlord wishes to do something else other than rent the property e.g. sell it, move back in or use the property for a family member or to use the property for some other reason than providing a home (holiday letting potentially?). This being the case, a landlord can end the tenancy at any point. Scottish Government has also introduced a housing specific first-tier legal tribunal to expedite housing matters that previously would get held up in the sheriff court system. This means that where a tenant is in breach of their lease, the landlord can take action more swiftly and at much lesser cost than before.
There are other important amendments restricting rent increases to once a year and increasing notification of access to the property from 24 hours to 48 (for things like inspections or carrying out safety checks or maintenance) but these have less ramifications than the points highlighted above.
We like it! It makes our jobs easier and makes the tenancy agreement a much simpler and more accessible document for both tenants and landlords and should make life easier for all concerned.
If you would like to discuss any of the opinion in this blog or you have any questions, please get in touch. [email protected] @Umeganeil