Change of Tenant - advice please !

thoroughhemnes

Hi, I just wanted to get some advice on the following situation:

There are 4 of us living in a shared house, we are in a joint tenancy (assured shorthold tenancy) with a fixed term of 12 months. We moved in in September 2023 so the fixed term ends in September this year.

One of us would like to move out into a new flat at the end of June and we have found someone who is willing and able to move in at the start of July. We have contacted the agency to start the process of assigning the tenancy (there is a fully qualified covenant for assignment in the contract) but have been told by the agency that they legally cannot assign the tenancy in the last 6 months of the tenancy. From my understanding, it is possible to assign at any point with the landlord's consent.

They have said that we would need to enter into a new contract with the 3 of us plus the new housemate however this would again be for a period of 12 months (which some of the current housemates may not wish to commit to) and may also mean a rent increase after only 9 months living there.

• Is it true that the tenancy cannot be assigned with less than 6 months to run on the fixed term? The agency have cited section 21 as support for this and said the landlord cannot end the tenancy with less than 6 months, which is obviously not the case here as the tenant is choosing to assign.
• If it is true, would it be possible to wait until September when the fixed term rolls into a periodic tenancy and then assign? Would this be the best option?

Thank you in advance for any advice !

saajan_12

thoroughhemnes said:

We have contacted the agency to start the process of assigning the tenancy (there is a fully qualified covenant for assignment in the contract) but have been told by the agency that they legally cannot assign the tenancy in the last 6 months of the tenancy. From my understanding, it is possible to assign at any point with the landlord's consent.

• Is it true that the tenancy cannot be assigned with less than 6 months to run on the fixed term? The agency have cited section 21 as support for this and said the landlord cannot end the tenancy with less than 6 months, which is obviously not the case here as the tenant is choosing to assign

It's not legally disallowed, but I suspect what the LL is worried about is this being seen as a new tenancy and then not being able to serve S21 notice in line with the original fixed term end date within 6 months of the changeover aka new tenancy. I think thats incorrect, as in they can assign with the new tenant taking over the outgoing tenant's rights & responsibilities.
However I do see the LL's worry, albeit ultra conservative, that a bad LL could exploit this by pretending a fully new tenancy was just an assignment from all the old tenants to all the new ones and no one remaining to get around the 6 month rule. So they could see the 6 month protection as applying to the new person's start date. 

thoroughhemnes said:

• If it is true, would it be possible to wait until September when the fixed term rolls into a periodic tenancy and then assign? Would this be the best option?

You could do this, and in the meantime, the remaining tenants all take the new person in as their lodger. The tenants mutually agree that the lodger's rent will  cover the outgoing person's rent, the amount, etc. Note the LL can still chase the original four, but this agreement gives a basis to ensure the right people pay. 

theartfullodger

There's no need for any new paperwork at all.  (NB there is only 1 "tenant" - all 4 of you).

One (or three..) moving out does not end existing tenancy nor their liability for the rent.  Just do it. New occupant is in happy position of no liability for rent 

Nothing preventing him having lodger agreement for 1/4 or total rent (remaining 3 being collectively his landlord ).

Yes, there would be two landlords.

Entirely legal (England).  Bonkers, but...

thoroughhemnes

saajan_12 said:

thoroughhemnes said:

We have contacted the agency to start the process of assigning the tenancy (there is a fully qualified covenant for assignment in the contract) but have been told by the agency that they legally cannot assign the tenancy in the last 6 months of the tenancy. From my understanding, it is possible to assign at any point with the landlord's consent.

• Is it true that the tenancy cannot be assigned with less than 6 months to run on the fixed term? The agency have cited section 21 as support for this and said the landlord cannot end the tenancy with less than 6 months, which is obviously not the case here as the tenant is choosing to assign

It's not legally disallowed, but I suspect what the LL is worried about is this being seen as a new tenancy and then not being able to serve S21 notice in line with the original fixed term end date within 6 months of the changeover aka new tenancy. I think thats incorrect, as in they can assign with the new tenant taking over the outgoing tenant's rights & responsibilities.
However I do see the LL's worry, albeit ultra conservative, that a bad LL could exploit this by pretending a fully new tenancy was just an assignment from all the old tenants to all the new ones and no one remaining to get around the 6 month rule. So they could see the 6 month protection as applying to the new person's start date. 

Thanks for your comment ! The issue I have is that we have to go through the agency (who probably haven't even informed the landlord) and are claiming that they we cannot legally assign.
Is there anywhere that I can point to (statute/case law) that would enforce the fact that it doesn't create a new tenancy with the agency as currently they are not taking on board my point?

thoroughhemnes

theartfullodger said:

There's no need for any new paperwork at all.  (NB there is only 1 "tenant" - all 4 of you).

One (or three..) moving out does not end existing tenancy nor their liability for the rent.  Just do it. New occupant is in happy position of no liability for rent 

Nothing preventing him having lodger agreement for 1/4 or total rent (remaining 3 being collectively his landlord ).

Yes, there would be two landlords.

Entirely legal (England).  Bonkers, but...

Thanks for your comment ! The issue I have is that we have to go through the agency (who probably haven't even informed the landlord) and are claiming that they we cannot legally assign.
Is there anywhere that I can point to (statute/case law) that would enforce the fact that it doesn't create a new tenancy, with the agency as currently they are not taking on board my point at all?

pinkshoes

I had this years ago when I moved out of a property due to a personality clash. The other 3 tenants agreed to cover the entire rent, and they then sublet my room to a lodger until the 12 month tenancy had finished. The lodger's deposit was given to me. The lodger's rent was the same as my share of the rent was so no one was out of pocket. It worked just fine. 

RAS

thoroughhemnes said:

The issue I have is that we have to go through the agency (who probably haven't even informed the landlord) and are claiming that they we cannot legally assign.

Why? How do they even know?

propertyrental

There is absolutely no legal impediment to assigning a tenancy in the last 6 months.

The new tenant takes on all the rights and liabilities of the departing tenant.

Saajan_12's suggestion that the LL (or his agent) might be concerned that a new tenancy is created, thus making serving of a S21  impossible for 6 months may be true - I mean the LL's concern may be true - but assignment does NOT end a tenancy, nor create a new one.

Indeed there are two ways the 4 names on the joint tenancy can be changed

1) mutually agree (all 4 tenants + LL) to surrender the tenancy. Return the deposit and do all end-of-tenancy processes. Then create a new tenancy, in new names, and take a new deposit, new inventory, issue EPC/gas report etc etc

or

2) assign the outgoing tenant's rights/obligations to the incoming tenant (who pays the outgoing tenant their share of the deposit). The existing tenancy continues (till Sept) when it is either renewed, changed automatically to a periodic AST, or the 4 tenant vacate and the tenancy ends.

As with 1) above LL consent is required as is all 4 existing + new incoming tenant.

https://england.shelter.org.uk/professional_resources/legal/renting/assignment/assignment_of_assured_and_assured_shorthold_tenancies

https://f.hubspotusercontent10.net/hubfs/5728567/Deed of Assignment - Reposit.pdf

As suggested earlier the alternative is for 1 of the existing tenants to just move out, and the new occupant to move in as a lodger, paying rent to the remaining 3 joint tenants. The problem with this is that the departing tenant remains a tenant, and remains liable for any shortfall in rent, damage etc.

thoroughhemnes

propertyrental said:

There is absolutely no legal impediment to assigning a tenancy in the last 6 months.

The new tenant takes on all the rights and liabilities of the departing tenant.

Saajan_12's suggestion that the LL (or his agent) might be concerned that a new tenancy is created, thus making serving of a S21  impossible for 6 months may be true - I mean the LL's concern may be true - but assignment does NOT end a tenancy, nor create a new one.

Indeed there are two ways the 4 names on the joint tenancy can be changed

1) mutually agree (all 4 tenants + LL) to surrender the tenancy. Return the deposit and do all end-of-tenancy processes. Then create a new tenancy, in new names, and take a new deposit, new inventory, issue EPC/gas report etc etc

or

2) assign the outgoing tenant's rights/obligations to the incoming tenant (who pays the outgoing tenant their share of the deposit). The existing tenancy continues (till Sept) when it is either renewed, changed automatically to a periodic AST, or the 4 tenant vacate and the tenancy ends.

As with 1) above LL consent is required as is all 4 existing + new incoming tenant.

As suggested earlier the alternative is for 1 of the existing tenants to just move out, and the new occupant to move in as a lodger, paying rent to the remaining 3 joint tenants. The problem with this is that the departing tenant remains a tenant, and remains liable for any shortfall in rent, damage etc.

Hi, this is super helpful and reflects the position that I have been trying to convey to the agents re. assignment not ending the existing tenancy ! I think they are trying to force us into ending the tenancy and signing a new contract in order to increase the rent which I am not willing to do.

theartfullodger

You don't have to go through agent, you are entitled to go direct to landlord.  

Artful, Landlord since 2000

propertyrental

theartfullodger said:

You don't have to go through agent, you are entitled to go direct to landlord.  

Artful, Landlord since 2000

and if you don't have the LL's actual address, you can require the agent to provide it:

Landlord & Tenant Act 1985 S1