April 2015 – Private Rented Sector (“PRS”) Tenancy Changes In The Offing

Author: Mitchells Roberton
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enancies (like people) come in all shapes and sizes. But when it comes to PRS tenancies they are usually either ‘assured’ tenancies or ‘short assured’ tenancies (both under the Housing (Scotland) Act 1988).

  • That’s a bit of an over-simplification. Some PRS tenancies aren’t either ‘assured’ or ‘short assured’. For example, a tenancy where the landlord is resident or where the letting is for a holiday will not (usually) count as either an ‘assured’ or ‘short assured’ tenancy. And there are other exceptions. But the vast majority of PRS tenancies will be either ‘assured’ or ‘short assured’.
  • One key element common to both categories is that if a tenant does not leave the property voluntarily on termination of a tenancy a court/tribunal order is required in order for the landlord to recover possession of the property.
  • Although the terms ‘assured’ and ‘short assured’ are similar there are important differences between the two categories. In particular, under a ‘short assured’ tenancy the landlord can, in principle, be sure of getting their property back at the end of the tenancy (even where the tenant has been a model tenant). On the other hand, a landlord’s getting their property back where there is an ‘assured’ tenancy can prove problematic.
  • Last month the Scottish Government issued a second consultation paper on proposals for devising a new form of PRS tenancy which would replace both ‘assured’ and ‘short assured’ tenancies.
  • This Note looks at some of the main proposed changes. Of course, in order to identify the changes, it also needs to identify the relevant key aspect of the current régime.
  • As mentioned above, it is easier for a landlord to recover possession of a property they have rented out if the form of the tenancy qualifies as a ‘short assured’ tenancy as opposed to an ‘assured’ tenancy. As a result, landlords generally aim to give a tenant a ‘short assured’ rather than an ‘assured’ tenancy. Accordingly, what follows tends to concentrate on the proposed changes as would affect the ‘short assured’ tenancy regime.


1.            Removal of no-fault ground for getting property back

1.1          Under a ‘short assured’ tenancy a landlord can get their property back simply because the agreed duration of the tenancy has come to an end.

1.2          The proposal under the new PRS tenancy regime is that this ‘no-fault’ ground for getting the property back will be removed. So a landlord would no longer be able to ask the tenant to leave the property simply because the tenancy agreement had reached its end date. Instead, the landlord would have to use one of the proposed new grounds for recovering possession (see section 4 below).


2.            Tenancy roll-over arrangements

2.1          Quite often ‘short assured’ tenancies are for an initial period of six months and then the agreement expressly provides that after the first six months is up the tenancy will then continue from month to month.

2.2          The aim of such “roll-over” arrangements is often so that the landlord can, in principle, get the property back at the end of any month (following the initial six month term).

2.3          The proposal under the new PRS tenancy regime is that such roll-over arrangements (e.g. from month to month after the initial six-month term) will no longer be allowed. Under the new system, tenancies will not be allowed to roll over on any basis that offers a shorter duration than the original tenancy agreement provided.


3.            Notice to quit – from landlords to tenants

3.1          Currently, if a tenancy lasts for more than four months, the minimum notice period is 40 days; and if the tenancy lasts for four months or less, the minimum notice period is 28 days.

3.2          The proposal is that there should be two notice periods linked to how long the tenant has lived in the property:

(a)          landlords will have to give four weeks’ notice where the tenant has lived there for six months or less; and

(b)          landlords will have to give 12 weeks’ notice where the tenant has lived there for more than six months.


4.            Grounds for repossession of the property

4.1          At present there are 17 different grounds under which an order for repossession of the property may be granted.

4.2          These grounds are generally relevant where the tenancy is an ‘assured’ tenancy as opposed to a ‘short assured’ tenancy.

4.3          About half of these are ‘mandatory’ (i.e. an order for repossession must  be given if the ground is proved), and the others are ‘discretionary’ (i.e. an order may be given – but may not).

4.4          The proposal is for these 17 ‘mandatory’/’discretionary’ ground to be replaced by 8 grounds – all of which would be mandatory. The proposed grounds are:

(a)          the landlord wants to sell;

(b)          the mortgage lender (if applicable) wants to sell because the landlord has broken the loan’s conditions;

(c)           the landlord or a family member wants to live in the property;

(d)          refurbishment;

(e)          change of use;

(f)           the tenant has failed to pay full rent over three months;

(g)          the tenant has displayed antisocial behavior; or

(h)          the tenant has otherwise broken their tenancy agreement.


5.            Standard ‘model’ tenancy agreement

5.1          At present the form of tenancy agreement is a matter for the parties concerned.

5.2          The proposal is to introduce a requirement to use a model tenancy document for all future PRS tenancies. The consultation paper suggests this could provide consistency of practice across the sector; help ensure good-quality and well-managed housing; and help promote landlords’ and tenants’ knowledge of their rights and responsibilities.



Note: This material is for information purposes only and does not constitute any form of advice or recommendation by us. You should not rely upon it in making any decisions or taking or refraining from taking any action. If you would like us to advise you on any of the matters covered in this material, please contact Paul Neilly: Paul@mitchells-roberton.co.uk

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