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I have just purchased a tenanted property and the tenancy is about to go periodic. This property will become my main home in the near future. I can simply issue a S21 to end the AST, but as a lodger landlord I have no objection to sharing with the current tenant.
I know I can't change from an AST to a lodger licence, as the tenant was there first. I believe that if I reduce the rent to £250 pa the AST is no longer valid, does it then become a common law tenancy? It's not a perfect solution, but it may get around the AST and is viable for the short term.
I will be creating a self contained annex with the intention of letting this on a common law tenancy (at market rent). If the tenant was to move from the main dwelling to the annex does the AST still take priority over the CLT?
Of course, I could just issue the S21 and find a new lodger. It would be easier for me but its a bit harsh for the tenant!
does the incumbent agree to the changes? in which case all pleasant and easy...or is ot a difficult situation? in which case S21 etc assuming that all the conditions necessary to exercise S21 are in order
The tenant has been previously sharing and asked if I objected to this. The tenant is also aware that I intend to live in the property in the near future. That's all we've discussed so far.
The tenant may well agree to accepting a lodger licence and sharing with me. Unfortunately, the Housing Act 1988 doesn't allow this.
You can't move into the property because the Protection From Eviction Act doesn't allow it, you'd be illegally evicting the tenant. Even if they agree to it.
If the tenant doesn't do anything about it, you'd get away with that, but their agreeing to it isn't a defence, if they do, now or at some point in the future.
If the rent is too low for the AST threshold you'd have two separate problems - when does the tenancy cease to be an AST (which is far from certain) and what the tenancy agreement says about notice, as the tenancy would probably become an Assured Tenancy, not a common law tenancy.
If you create a "self contained annex" that is a dwelling house, it will almost certainly be an AST if you let it to people to live in.
Thank you John-Paul. A little more to think about there.
I know, as a resident landlord, I can let the annex on a CLT. It seems the only exception to this will be the current tenant!
Hmm if the annex is self contained then it's likely to be an ast rather than an excluded tenancy because there isn't any sharing with the T ?
( both for the existing and any new tenancies )
DISCLAIMER just my personal opinion - for legal advice consult a qualified professional grown-up.
To quote from Tessa Shepperson's excellent site regarding common law tenancies:
As the current tenant will have lived there prior to me, it fails on that point.
Schedule 1 of the Housing Act 1988 gives the full detail:
Whether it is excluded or not is also a matter of sharing, not only residency and is not what I was questioning, although by definition I can't create an excluded AST.
Learn something new every day !
Hi Gary, I'm constantly surprised by the depth of my ignorance, especially in areas of letting law I thought I understood.
If it was mine, I'd agree the following with the tenant: I'd issue a S21 (while I still can!) and agree with the tenant that his lodger licence starts with a clear (48hr) gap between the end of his AST. You move in when his AST expires and before his lodger licence starts. nice and clean. He would have to move out for 48 hrs to be completely compliant