OpenRent Community

AST Tenancy - joint for all tenants or one Agreement for each

Hi I am a newbie and very confused with how to set up my Tenancy Agreement with OpenRent. I have sent a couple of emails but dont seem to get the question I am asking answered. To all you landlords out there who manage houseshares can you please help me.

I currently have a joint Shared Tenancy Agreement which was set up several years ago by an Estate Agency. The Agreement lists includes all four tenants and states the rental as a whole. However two of the tenants on that Agreement are exiting hence my search for two more which I have found.

My question is - do I need a Joint Tenancy Agreement covering the whole house or can I have a single Agreement for each tenant so that when one person leaves in the future Im only renewing one Agreement. In that case do I just get Open Rent to draw up two seperate Agreements even though they are for the same property.

I hope someone will understand my ramblings. My tenants are due in this Thursday so this matter is becoming rather urgent. Any advice much appreciate
Thank you in advance
I hope that all makes sense

I need some further data to help you out please?

  1. Did you ever re-new the AST since initial commencement/signing years ago?
  2. Is the property a Licensed HMO?
  3. Who’s AST did you use, i.e. OpenRent, NLA etc?
  4. Are you saying that there are 4 people there presently all on 1 AST joint and 2 of those said tenants now wish to leave and the existing staying 2 tenants would be happy for you to bring in 2 strangers and re-sign up to a new AST as a group of 4, so you end up same as before, with 4 people on 1 tenancy?
  5. Are all 4 people before and proposed all unrelated?

Hi Alison,

The first thing to know here is whether this old tenancy is being terminated or not. Did these tenants service notice? Have you served notice? Have you agreed with the tenants to mutually surrender the tenancy?

If not, then your old tenancy will still be running. In this case, you can’t set up additional, new tenancies for the same property, since the property is already let to the original four tenants.

Hi Andrew thanks for your reply

  1. Yes it was renewed a number of times. For much of that time the Letting Agents Townends managed this. When a tenant left they would issue another joint tenancy and the remaining tenants would sign again and the new tenant would be inserted on the document in place of the existing tenant and sign too. Seems incredible that the existing tenants agreed to it but I dont think they realised the implications.

  2. The property is not a licensed HMO

  3. The AST was compiled by the letting Agents ie Townends

  4. As bizarre as it sounds thats the way its always been done. However now Ive taken over managing it myself I realise what a ridiculous situation that is and it makes it extremely difficult to manage

  5. All 4 people (the two existing tenants and the incoming new tenants are all unrelated)

Ok, so what you need to firstly confirm is the date the AST was last signed/re-newed as you need to know if its in a fixed or rolling term presently you see as if its fixed then you can not do what you wish to do the way you propose to do it.

Please do further confirm if it is you whom signed the AST or the agents on your behalf maybe?

Secondly, are you sure that the property is not classed as a Licensable HMO, i strongly advise you to seek advise from your local council HMO enforcement department before you move even 1 more muscle, this is paramount to be 100% confident, preferably get confirmation with them via email as i believe the property is Licensable you see and this changes everything…

Also who pays the bills? c/tax, gas, elec, council tax etc?

Who is responsible for the common parts, presumably the tenants if they are renting the whole property?

Hi Andrew the AST was last signed by all parties in August 2018. I signed it as Landlord. It runs for 12 months and then needs signing again

Thanks for the advice re HMO I will check with the council tomorrow

The tenants are responsible for the common parts because they are renting the whole house. They pay council tax and utilities in addition to the rent

Let me know how it goes tomorrow with the council as I’m pretty sure you’re going to find that your property is an HMO and you become immediately ridiculously busy but regardless me a shout if I can help I’ll try

You may wish to re-evaluate which is more financial economic or for you renting room by room or renting the whole building as you will get a lot more room for room and you will gain full control of all of the communal areas which means you can come and go as you please to all communal areas within the building such as the kitchen garden corridors and any other spare rooms as you may want to strongly consider renting out a room for room basis if it is an HMO which I’m sure it is as this way you can manage the property much better to comply with the requirements that your have to comply with so I don’t want to advise too much until I know if it’s HMO or not

Hi Andrew

We do not need to register as a HMO because we do not meet the criteria of “has five or more occupiers comprising two or more separate households, regardless of number of storeys” for our Council

Yes that rule is for a license but the fact that you have four separate households in one single property by share definition makes the property a HMO property, Just in your case you ever definitely don’t need a license yet you still need to comply with HMO regulations.
Have you confirmed with your mortgage company and buildings insurance that you are covered for renting out your property as a HMO?
Obviously regardless to the risks that you’re willing to take or not or which ever situation you prefer then you simply cannot scrap the AST premature so it looks like you’ve got a good few weeks or so before you can do another agreement and at the end of the day if all tenants agree to what you propose then there should not be a problem however if you are re-signing up to a new AST I would advise you to ensure that you have the correct type of AST for HMO there is a way that you can change a tenant or two for others without doing the procedure that you are doing it’s a legal document and you can download it from the NLA website, I can’t remember the name for sure but I think it is called an addendum if you called NLA they should be able to tell you easily which document if you wanted to do it that way so you do have more than one option.
I feel strongly that you need to seek an alternative AST other than the one that you have been relying on as the one you have been relying on ties you in somewhat to the company that issued it and I don’t know if they are up-to-date with all the new rules and regulations or not so I would further advise you to sign up to the NLA As they will issue you free advice as and when you want it on the telephone and there is an array of documentation for you to download for free from their website and I feel you would greatly benefit from such a service especially knowing that you are dealing with a Hache as they will issue you free advice as and when you want it on the telephone and there is an array of documentation for you to download for free from their website and I feel you would greatly benefit from such a service especially knowing that you are dealing with a HMO property.
Regardless to what you decide to do don’t forget to ensure that you issue all the necessary documentation each time you renew the tenancy such as a full inventory CP 12 gas certificate and EPC EHIC certification for the electrics and don’t forget the PAT testing For any portable appliance you have of you around at the property as well as all of the other documentation that you legally have to provide of course.
Have I answered your question correctly ?

I would check I have a property with a shop and two flats above with one person in each .It was classed as a small HMO