Property Professional Magazine

Read The tenancy that never ends our featured article on the PRT in Issue 28 of the Property Professional magazine. More info...

Private Residential Tenancies Regime

As of 1 December 2017, under the Private Housing (Tenancies) (Scotland) Act 2016, a new Private Residential Tenancy (PRT) replaced the previous assured and short assured tenancy agreements for all new tenancies granted in Scotland.

Agents will no longer be able to use SAT’s for any new tenancies that begin on or after 1 December. The Scottish Government has released a new tenancy agreement, together with the following prescribed notices and forms. All forms are Word documents so may not download on a mobile or tablet device.

The new type of tenancy is an open-ended tenancy designed to minimise disruption to tenants' lives, so that they can feel safe and secure in their home without fear of eviction at short notice, just because the tenancy reaches the end. The 'no-fault' eviction option available under the old Short Assured Tenancy will no longer be available.

Scotland

THE NEW CONTRACT

Tenants must be provided with written terms of any new contract before the end of the day on which the tenancy starts (or no later than 28 days after an existing tenancy becomes a PRT). This can be a paper copy, or an electronic copy if the tenant agrees to this.

To make things easier you can also create a Model Tenancy Agreement on the Scottish Government website. In both instances, if you use the Model Tenancy Agreement you must also provide the tenants with a copy of the Easy Read Notes. More info...

Creating your own contract

You can still create your own contract but you must include nine mandatory tenancy terms and make sure you fully understand the Private Housing (Tenancies) (Scotland) Act 2016 and any supporting legislation. It's therefore advisable to use a solicitor.

NB: If you are creating your own contract you need to be aware that clause 2 relating to rent increases, clauses 6, 7 and 8 relating to access for repairs and clause 9 relating to termination in The Private Residential Tenancies (Statutory Terms) (Scotland) Regulation 2017 differ slightly from the equivalent sections in the Model Tenancy Agreement and this must be reflected in your agreement.

If you create a contract yourself you will also need to provide the tenants with the Private Residential Tenancy Statutory Terms Supporting Notes instead of the Easy Read Notes. More info...

BRINGING THE TENANCY TO AN END

Tenants can give bring the tenancy to an end by giving the landlord at least 28 days’ notice, taken from the time the landlord receives the notice.

Landlords (or agents acting on behalf of their landlord) will only be able to bring a tenancy to an end by serving a Notice to Leave, which relies upon one of 18 grounds for eviction. Eight of these grounds are mandatory, eight are discretionary and two can be either. More info...

Mandatory grounds

Where the First-Tier Tribunal (Housing and Property Chamber) agrees that the ground exists.

Examples include: The landlord intends to sell the property, the landlords mortgage provider wants to repossess the property, or the tenant has a relevant criminal conviction, or the property has been abandoned by the tenant.

Discretionary grounds

The Tribunal still has to decide whether it's reasonable to issue an eviction order, even if they deem that the ground is met.

Examples include: Tenant has breached a term of the tenancy agreement, tenant has engaged in anti-social behaviour or the landlord's HMO licence has been revoked.

Grounds which could be either

Depending on the circumstances of the case. For example, where the tenant has been in rent arrears for three consecutive months. If the tenant owes at least one month's rent when the tribunal considers the case on its merits, then the ground is mandatory. If they owe less than one month's rent on the first day of the tribunal, the ground is discretionary.

NB: The notice period for the Notice To Leave will be 28 days for all grounds if the tenant has been in the property for less than six months or if one of the conduct grounds applies (for example rent arrears). Otherwise it will be 84 days if your tenant has lived in the property for longer than six months and you are not relying on one of the conduct grounds.

POTENTIAL ISSUE WITH JOINT TENANCIES

Initial feedback since the introduction of the PRT is that tenants are finding the changes harder to adjust to than landlords or agents. One issue that has been raised as a potential problem is how to deal with joint tenancies which are PRTs; in particular, the common scenario where there is a joint tenancy and one tenant wants to leave.

In short, provisions within the Act indicate that where there are two or more joint tenants all of those joint tenants are required to give notice to bring a PRT to an end. This has implications for joint tenants. The main one being that, where only one joint tenant wishes to leave, they cannot simply give notice to bring their liability under the PRT to an end. 

In this situation, without notice from the other joint tenants, the PRT continues as does all tenants liability to pay rent etc under the PRT. This could, in theory, be indefinite. As a result, we have sought expert opinion on this via legal counsel on this. More info...

FREQUENTLY ASKED QUESTIONS

When do I need to create a PRT?

Any new residential tenancy agreement that commences on or after 1 December must be on a PRT if it is let to an individual (or joint tenants) who are occupying as their only or main home and it is not one of the excluded properties (found in schedule 1 of the Private Housing (Tenancies) (Scotland) Act 2016). Excluded properties include shop premises, licensed premises, agricultural holdings, holiday let or resident landlord situations.

Can agents sign the PRT on behalf of the Landlord?

Yes, this is acceptable.

Can an existing Short Assured Tenancy continue on a month to month basis after 1 December?

Yes. Saving provision were introduced which means a Short Assured Tenancy will remain after 1 December and if they continue a monthly rolling basis they will remain Short Assured Tenancies.

Do I still need to issue a tenant information pack?

No. However the tenant still needs to receive information about the property regarding the safety standards such as the EICR and EPC.

What happens if the tenant doesn't move out when the notice period ends?

Landlords or their agent can then apply for an eviction order via the First-tier tribunal if the tenant does not move out as soon as the notice period ends.

Increasing rents and additional charges

Landlords won't be able to increase rents for properties they own more than once in any given year, and tenants must be given a least three months’ notice of any planned increase, using the 'landlords rent-increase notice to tenant(s)' form.

Tenants will also have the right to have the rent assessed by a rent officer if they feel that the rent increase is unfair. They will need apply within 21 days of notification by the landlord and must tell their landlord by completing Part 3 of the 'landlord's rent-increase notice to tenants(s)'. However, it should be made clear to tenants that rent officers also have the power to increase the rent if they feel it should be higher.

Besides the rent itself, the only additional charge you can make to a tenant is security deposit of no more than two month's rent.

Property Professional Magazine

Read The tenancy that never ends our featured article on the PRT in Issue 28 of the Property Professional magazine. More info...