1. Lease Paperwork
When beginning a new Short Assured Tenancy, landlords are free to draw up their own lease as long as it contains prescribed information including; full names of landlord and tenants, the deposit amount, and instructions for ending the tenancy. All tenants sign an AT5 before signing the lease, and landlords (or their letting agent) must provide tenants with a Tenant Information Pack.
The Scottish Government has produced a model Private Residential Tenancy lease (the full document can be found here) for landlords to use after 1st December, which aims to standardise tenancy agreements across Scotland. The model agreement is clearer and includes mandatory and discretionary clauses; landlords can remove or alter the discretionary clauses as long as they do not contradict any of the mandatory clauses, meaning that landlords still have flexibility to tailor the lease to meet their needs. Under the new regime there will be no pre-tenancy notices, simplifying the process.
- Model lease with mandatory and optional clauses.
- No pre-tenancy notices.
2. Lease Dates
Including the start and end date of the tenancy in the lease is part of the prescribed information that is included in a Short Assured Tenancy. A Short Assured Tenancy must be a minimum of 6 months - leases typically have an initial term of 6 or 12 months - then can either roll month to month with either party having a fixed notice period, the tenancy can be ended, or a new Short Assured Tenancy can be issued.
In contrast, Private Residential Tenancy leases will have a start date only, so there will be no set term for the tenancy. Removing the minimum term means that tenants could, in theory, serve notice at any point after the start date of the lease. This also gives tenants an increased security of tenure by not specifying a date by which the tenancy will end.
Read our recent blog post ‘The New Private Residential Tenancy: No Minimum Term’ for more information and considerations for landlords.
- A lease will have a start date only.
- No minimum term for tenancies.
- No end date for tenancies.
3. Rent Reviews
Landlords have always had the right to set and review their rent at the market rate and this will continue under the new tenancy regime.
Landlords with Short Assured Tenancies can review the rent at any time during the tenancy, subject to the terms outlined in the lease. In most tenancy agreements this tends to be once per year and out with the initial term.
For Private Residential Tenancies, landlords will be restricted to once per year for rent reviews and must give tenants a minimum of three months’ notice that their rent will be changing.
Currently, if tenants feel their rent increase is excessive, they can ask the Private Rented Housing Panel (PRHP) to set the rent. Under the new regime, tenants will ask the Housing and Property Chamber (HPC) to set the rent if they feel an increase is excessive. In practice landlords don’t often increase rents to levels that tenants are unhappy with during a tenancy, and so, tenants rarely feel the need to take this step.
- Rent reviews restricted to once per year.
- Tenants must be given three months’ notice of rent increases.
4. Rent Pressure Zones
Rent Pressure Zones (RPZs) do not currently exist in Scotland, these will be introduced with the new tenancy regime.
Local councils across Scotland will have new powers to apply to the Scottish Government for a RPZ for a specific postcode if they feel that rent levels in the area are rising too quickly. If approved, the RPZ will mean that rent increases will be capped, but increases of a minimum of 1% above CPI will still be allowed.
RPZs will only be permitted in extreme circumstances where local councils can prove that excessive rent levels are causing undue hardship to tenants.
- Local councils can apply for rent pressure zones.
5. Ending a tenancy: Tenants
A Short Assured Tenancy can only be ended during the initial fixed term period if this is mutually agreed between the landlord and tenant, or by the landlord if the tenant is in breach of the agreement by, for example, not paying rent.
Once the Short Assured Tenancy has passed the initial fixed term period - a minimum of six months - most leases set one or two month notice periods for tenants, or 28 days by default if it is not mentioned in the lease.
Tenants with Private Residential Tenancies will now have a standard notice period of 28 days, which must be issued in writing, and can be given at any date from the start of the tenancy.
- Standard notice period of 28 days.
- Can give notice at any point from the start of the tenancy.
6. Ending a Tenancy: Landlords
Ending a Short Assured Tenancy as a landlord can be a complicated process involving issuing various notices including a notice to quit, a Section 33 notice, and sometimes an AT6. The Private Residential Tenancy will require landlords to serve a single Notice to Leave form, simplifying this process. The notice period required, however, will not be so straightforward.
Landlords can currently end a Short Assured Tenancy by giving two months’ notice to the end date of the tenancy, or by using one of 17 grounds for ending the tenancy such as rent arrears or damage. Under the new regime the notice period will vary depending upon the ground that is being used to end the tenancy and, in some cases, the length of time that the tenant has lived in the property.
The grounds for ending a tenancy have been modernised for the new Private Residential Tenancy, there are now 18 grounds, which include the landlord selling the property, extensive renovation works, or moving back in. A full list of the 18 revised grounds for eviction can be found here.
For the majority of the grounds the landlord will have to give tenants 28 days’ notice if the tenant has occupied the property for less than 6 months, or 84 days’ notice if they have occupied the property for more than 6 months. However, for grounds applied when the tenant is in breach of their lease or the law, the landlord will be required to give 28 days’ notice, regardless of how long the tenant has occupied the property.
- Serve a single Notice to Leave to end a tenancy.
- 18 revised grounds for eviction.
- Notice period for can vary between 28 and 84 days.