The Landlord and Tenant Act 1954 dictates that a tenant is eligible for a new lease at the end of the contract with the same provisions as the previous lease, provided there is an adequate modification of the lease at a new rate, adjusted to inflation.
The Landlord and Tenant Act 1954 modifies or expands on the Landlord and Tenant Act 1927, the Leasehold Property (Repairs) Act 1938, and section eighty-four of the Law of Property Act 1925. It is detailed descriptive legislation consisting of multiple clauses such as section 11, section 13 rent increase, section 21, section 8. click here to learn more.
What Does “Outside” The Landlord and Tenant Act 1954 Mean?
It is crucial for a landlord and tenant to reach a mutual decision on whether the tenancy agreement for a commercial property will fall inside or outside the Landlord and Tenant Act 1954. The decision to keep the lease inside or outside the Landlord and Tenant Act 1954 is influenced by several reasons. Let’s say, if a tenant is only interested in continuing the commercial activity for a limited period, they would likely be willing for the tenancy agreement to be outside the Landlord and Tenant Act 1954.
If a landlord wants the power of allowing or not allowing renewal of tenancy agreement, he/she/they will need to curate the lease to be outside of the Landlord and Act 1954. This is because if the lease falls inside the Act, it will have to substantiate an appropriate reason listed in the Landlord and Tenant Act 1954 to be exempted from ordained lease renewal.
If this doesn’t happen, the tenant is entitled to a lease renewal at the end of the current one under the Landlord and Tenant Act 1954. For a tenant, it is important to figure out whether they want the lease to be inside of the Landlord and Tenant Act 1954 or outside of it. It is arguably as crucial a question to consider as ”What documents do I need to rent a flat?” – another important article we wrote at Lofti for both landlord and tenant to understand.
Renters typically prefer for the lease to be inside the Landlord and Tenant Act 1954 as it gives them greater confidence that they will be able to retain their commercial activity in their established marketplace. This is simply because a commercial tenant cannot afford to leave their customer base built over the years or the cost of constantly moving from one place to another therefore, the Landlord and Tenant Act 1954 protects their rights.
However, for obvious reasons, landlords prefer for the lease to be outside of the Landlord and Tenant Act 1954. The Act makes it considerably difficult for landlords to get back premises without having to accommodate the tenant in this decision-making. The Landlord and Tenant Act 1954 only allows landlords to be exempted from lease renewal if they intend to renovate the property or start living there themselves. Furthermore, even if the landlord does reclaim control, the tenant may be liable for monetary compensation according to the Landlord and Tenant Act 1954. A tenancy agreement can also include a break clause tenancy that permits both parties to exit the contract earlier than its completion.
There is a particular process set in place that needs to be followed if a tenancy agreement falls inside the Landlord and Tenant Act 1954 and you want to change the agreement to fall outside of it. The first and fairly simple step is for the landlord to give the renter a warning letter at least 14 days before they have to sign the document that places the tenancy outside the Landlord and Tenant Act 1954.
This specific period is to ensure that a tenant has adequate time to make an informed and relaxed decision regarding a tenancy being outside the realm of the Landlord and Tenant Act 1954. The warning notice informs the tenant of the rights they would be giving up by signing the new tenancy agreement that does not fall under the Landlord and Tenant Act 1954. The lessee has to formally acknowledge they have read and comprehended the notification and approval of the implications changing in terms of the act.
The new tenancy agreement has to specifically mention the warning and statute declaration of the Landlord and Tenant Act 1954. If the tenant waits for 14 days to sign the contract, they will only need to submit a “simple statement” acknowledging that they have read and comprehended the warning and understand the implications of entering into a tenancy agreement outside of the Landlord and Tenant Act 1954.
However, the lessee may sign a “statutory declaration” if the parties cannot or are reluctant to queue for the requisite 14 days to contract out of the act. Similar to the simple declaration, this one also has to be verified by an impartial solicitor or an oath commissioner.
The statutory declaration approach is frequently employed since it is thought to be the best path for the warning and declarations to be submitted at the earliest possible time. Important requirements to be aware of include that the contract should be for a certain duration and that the warning and declaration must be exchanged before the renter is obligated to sign the agreement.
What Is The Landlord and Tenant Act 1985?
The different duties and privileges that landlords and tenants in residential real estate leases are subject to are defined by the Landlord and Tenant Act of 1985. The purpose of the Act, which was enacted to help both landlords and renters, is to set basic standards that a landlord must provide to their tenants. It has helpful features that limit the potential for conflict and gives both parties more clarity. Click here to learn more
The buy-to-rent boom emerged just several years after the Landlord and Tenant Act of 1985, which established that rental contracts should last no more than 7 years. There were only regulated tenancies previously and no assured shorthold tenancy (AST) agreements.
Rent officers established “fair” prices for regulated leases, which were frequently adjusted at 50% of the market rate. Regulated tenancies provided all tenants with a life tenure that they may transfer to other occupants of the property upon their demise. As a result, many landlords were unable to recoup their investments or pay for repairs.
The Landlord and Tenant Act 1985 majorly outlines the rights and responsibilities discussed below:
Right to know your landlord
Landlords typically use third parties such as letting agents handle the property management and the responsibilities that come with it, largely to save themselves from the time-consuming hassle. In cases such as this, a tenant may be dealt with by a letting agent completely from first reaching out to checking out the real estate to signing the tenancy agreement to tenancy check-in and corresponding over issues such as repairs. Henceforth, the Landlord and Tenant Act 1985 allows the tenants the right to know the name and address of their landlord by sending in a request in writing.
Tenants have to deal with “minor repairs”
What constitutes modest maintenance and who will be liable for them must be specified in the leasing contract. The tenants’ duties typically include maintaining a house and outside area reasonably sanitary and orderly, verifying the reliability of any electrical devices they own, and performing simple maintenance, such as replacing light bulbs. A clause stating that the renter, their guests, their family, or their pets are liable for any losses should be included in the lease.
Right of quiet enjoyment for tenants
The Landlord & Tenant Act of 1985’s Section 9A(8), which controls when a landlord is permitted to enter a tenant’s residence, is known legally as the “quiet enjoyment” clause. Except for cases of emergency, for example, a fire or burglary. The renter is entitled to 24 hours written warning before the entrance to the premises is necessary as well as the right to a more comfortable scheduled visit. However, after a scheduled appointment, the tenant is obligated to let the landlord or contractor on the premises when they show up.
Maintaining safe living standards
The Act dictates that it falls upon the landlord to ensure that the premises they are renting out are up to standards. For instance, the building safety fund ensures that the property is up to safety standards at any given time. In tenancies that began before March 20, 2018, this obligation was limited to the beginning of the contract but since then, the landlord is now required to maintain the required standards throughout the contractual period.
Defining safe standards
The Act outlines a few crucial standards to maintain for landlords such as gas safety (gas safety certificate issued after property check is called cp12 under the Landlord and Tenant Act 1954), electrical safety, fire safety and making sure there are no damps, moulds, rodents or pests found on the property being leased out.
Landlords must deal with major repairs
Minor repairs’ obligations will be addressed by a lease contract, but Section 11 of the Act controls the owner’s responsibilities to manage and restore a private residential property. Major repairs consist of the building’s framework, wiring for electricity, gas or water piping, washroom essentials, common amenities like hallways (in shared accommodation), and making the repairs look presentable.
Reporting a repair
Landlords are obligated to ensure repairs in an appropriate time window. An appropriate time is determined with an objective view, for example, a gas leakage has to be immediately addressed whereas, fixing the shower could take around 3 days and still not cause much hindrance. A need for repair can be communicated orally or in writing. While both are legally binding and have a case in the court of law, it is smart to keep receipts of communication in case of disagreements. Negligence towards repairs can cost a landlord hefty fines as it is a civil law violation. However, a landlord is not held accountable if (a) the tenant has not informed the landlord, or (b) has tried to prevent them from carrying out repairs.
What is the Housing Health And Safety Rating System (HHSRS)?
All privately leased residential properties in Wales and England have to complete the HHSRS check successfully, used by the local councils to assess if the properties are livable.
Right to rent
A landlord or their agent is allowed and required to run a background check on potential tenants to ensure they are residing in the United Kingdom (UK) legally.
What Is The Section 25 of the Landlord and Tenant Act 1954?
The Section 25 notice of the Landlord and Tenant Act 1954 deals with the conclusion of a commercial real estate tenancy agreement that falls inside the Landlord and Tenant Act 1954. If the notice is not served by the end of the lease term, it is presumed to be renewed under the law. It is important to note that Section 25 notice is not only served when a landlord wants to move on from a tenant. This notice is also incredibly crucial for the tenancy agreement to be updated according to the times such as adjusting the rent according to current housing market trends.
The Section 25 notice has to be served anywhere between 6 to 12 months before the lease comes to an end to allow the tenant sufficient time to consider the notice, accept/challenge it, and look for another appropriate commercial property. This notice is legally required to establish whether the landlord is welcoming a renewal of the tenancy agreement by the current renter for reasons that allow exemption from lease renewal under the Landlord and Tenant Act 1954. This part of the Section 25 notice either makes it hostile or friendly towards a tenant.
A tenant being negligent towards “minor” repairs all over the property, multiple missing rental payments, significantly violating other rights of a landlord, having another accommodation, sub-letting a property without the consent of the landlord or the agreement not reflecting it are all considered valid reasons for the landlord denying the request of a lease renewal.
However, a landlord is also allowed to reclaim control of the property and not renew the lease under mandatory grounds as opposed to the earlier discretionary grounds if he/she/they wants to either demolish or reconstruct the property or bring the property under their use/occupancy for personal or commercial purposes.
Within six to twelve months of the tenancy period’s completion, the tenant must serve the landlord a Section 26 notice if they want to initiate the lease renewal process. In the event that the Landlord objects to the application, they must provide a counter-notice within two months of the request’s submission, outlining their reasoning for the rejection of lease renewal. As discussed earlier, the reasoning has to be objective and listed in the Landlord and Tenant Act 1954.
A Section 26 Notice, although, cannot be issued if the Landlord has given a Section 25 Notice earlier; the Tenant must instead respond to the Landlord. In a similar fashion, once the tenant has already sent a section 26 notice, the Landlord cannot serve a Section 25 notice.
What Is The Section 34 Landlord and Tenant Act 1954?
This part of the Landlord and Tenant Act 1954 grants the judiciary the power to decide an objectively reasonable rent of a commercial property during the renewal of a tenancy agreement. This only happens when the landlord and tenant are in conflict and the matter reaches the court of law. Which will result in court costs if there is an eviction. This can be done by issuing a form N215. There are two elements considered when the appropriate rental amount is being deduced.
The first is the evaluation of an approximate rental rate being charged for the kind of property in question in the housing market at the time. Secondly, the amount of time for which the property has been occupied by a lessee is taken into account. The longer the property has been occupied, the greater will be the leverage of the tenant in the court of law.
Which tenancies can the Landlord and Tenant Act 1954 not be applied to?
The Landlord and Tenant Act 1954, which only pertains to commercial properties being let and doesn’t include residential properties, also excludes specific business premises from the Act. This information is necessary for a tenant to consider before deciding on appropriate lease options.
The Landlord and Tenant Act 1954 cannot be applied if the rental contract is of 6 months or less with no clause allowing extension of the lease, occupancy of the period is 12 months or less, specific types of agricultural tenancies, occupancy is gained via licence and not a tenancy agreement, rental contract mutually agreed on by both parties falls “outside” of the Landlord and Tenant Act 1954, or the occupant’s employment is related to the tenancy.
The Act guarantees certainty of tenancy for inhabiting renters under specific tenancies of residential real estate at affordable rates and for existing subtenants of renters under such contracts. The act allows business tenants the flexibility to request a renewal of the tenancy agreement at the conclusion of the agreed-upon period and to continue occupying the space.