Assured Shorthold Tenancy Agreement Rent Review: What to Know
As a tenant or landlord, there are many things you need to consider when entering into a tenancy agreement. One of them is the rent review clause. This clause outlines how and when the rent for your property will be reviewed and increased during the tenancy period.
What is Assured Shorthold Tenancy Agreement?
Assured Shorthold Tenancy Agreement (AST) is a type of tenancy agreement commonly used in the UK. Under this agreement, a landlord can rent out a property for a fixed period, usually six months or a year, to a tenant. During this period, the tenant has the right to occupy the property, but the landlord can regain possession after giving notice.
What is Rent Review Clause?
The rent review clause is a provision included in a tenancy agreement that outlines how and when the rent will be reviewed and increased during the tenancy period. The clause will vary depending on the type of tenancy agreement, but usually, the rent will be reviewed every six or 12 months.
How Does Rent Review Work?
Rent review works by adjusting the rent across a set period in line with market rates or other factors agreed upon by both parties. For an AST, the rent review is typically set at six or 12 months, and it can be done by the landlord or the letting agent.
The rent increase can be based on a pre-agreed percentage rate or linked to the inflation rate as published by the Office for National Statistics (ONS). The landlord or letting agent will notify the tenant of any rent increase in writing, usually at least one month before the increase takes effect.
What to Know About Assured Shorthold Tenancy Agreement Rent Reviews
There are several things tenants and landlords need to know about rent reviews, including:
1. The rent increase must be fair and reasonable: It is essential to ensure that any rent increase is fair and reasonable. The rent increase should be in line with the market rate for the area and should not cause undue hardship to the tenant.
2. Negotiation is possible: Tenants can negotiate on the rent increase if they feel it is not justified or is too high.
3. The rent review is not automatic: It is important to note that the rent increase is not automatic. The landlord or letting agent must give notice of any increase and provide a valid reason for the increase.
4. Get everything in writing: It is important to get any agreement or arrangement in writing. This will help to avoid any misunderstandings or disputes in the future.
In conclusion, an assured shorthold tenancy agreement with a rent review clause is a common type of tenancy agreement in the UK. The rent review clause outlines how and when the rent will be reviewed and increased during the tenancy period. It is important for both landlords and tenants to understand the terms of the agreement to avoid any misunderstandings or disputes in the future.