Private Rented Tenancy (PRT)
As some of our landlords may be aware, the Scottish Government have introduced changes to the Private Rented Sector and the creation of tenancy agreements.
This is one of the most significant changes to the Scottish private rental market in a decade.
From 1st December 2017 all new tenancies will be a Private Rented Tenancy (PRT), this will replace Short Assured Tenancies and Assured Tenancies.
The aim of the tenancy and improvements for landlords:-
- Improved security for tenants
- provide safeguards for landlords, investors and lenders
- No more confusing notices
- Quicker referral of rent arrears cases
- Scottish Government recommended model tenancy agreement, which includes standardised terms
- 18 new modernised grounds of possession, including if the landlords wishes to sell and if the property has been abandoned
What is in the tenancy agreement:-
The Scottish Government has produced a model lease which may be used by landlords/agents. Its not compulsory to use the model agreement but all agreements must contains two types of clauses:-
- Mandatory clause - these must appear in all PRTs these are statutory terms, repairing standards and tenancy deposit.
- Discretionary clauses - these can be removed or altered.
All PRT leases must contain certain mandatory terms and we are working with our legal advisers to analyse the wording of the lease and any additions or amendments.
http://www.legislation.gov.uk/sdsi/2017/9780111036655
Only one date is needed on the lease - the start date. Legislation does not allow the parties to agree a duration for the lease or an end date. The tenancy can be terminated at any point after the start date by the landlord or tenant.
Rents can only be increased once every 12 months with a 3 month notice period.
Tenants being offered a PRT must be issued with guidance notes.
Ending the PRT tenancy:-
One of the main changes is the removal of the 'no-fault' eviction ground. This allows landlords/agents to ask a tenant to move out with two months' notice once their original Short Assured Tenancy lease period expired without any further reasons being required. Landlords/agents now on the PRT have to state at least one recognised 'eviction ground' for bringing the tenancy to an end. There are 18 grounds for possession including the landlord looking to sell/refurbish or move into the property, to use it for non-residential purposes, anti-social behaviour or criminal conduct or the tenant being in arrears for three or more consecutive months.
LANDLORDS NOTICE
The notice period for most grounds is 28 days providing the tenant has occupied the property for 6 months or less, and 84 days notice if the tenant has occupied the property for 6 months or more. Certain grounds require 28 days notice regardless of the duration of the tenancy.
TENANTS NOTICE
If the tenant wants to leave, they must give a minimum of 28 days notice in writing. They can issue this at anytime after the start date. The landlord can only end the tenancy if one of the 18 grounds for possession apply.
Existing Short Assured Tenancies
All current short assured tenancies are not affected by the PRT, and will continue to operate in perpetuity until terminated by the landlord or tenant. However it is not possible to create new Short Assured Tenancies.
Please get in touch if you have any questions and we will do our best to help.
