Is a type of residential tenancy of land in England and Wales so called because it was regulated under the eponymous Rent Acts, the last of which was in 1977.

Rent Act tenancies are an increasingly rare beast nowadays, because since the Housing Act 1988 came into force on 15 January 1989 no new Rent Act tenancies can be created (other than in one very specific circumstance.)

The defining features of Rent Act tenancies was that firstly, they were subject to severe rent control, and secondly, the tenant had enormous security of tenure, way beyond even a so-called "secure" tenancy. Because of this, private landlords, especially during the 1980s property boom, found it increasingly difficult to acquire new premises to let out to people, because even at the highest rent they could obtain, they would not have been able to cover the mortgage. Furthermore, the property was then effectively unsaleable, because it was so difficult to get out the tenant so the landlord could then sell with vacant possession, and unless the buyer was buying outright they would not have been able to afford to buy it with a sitting tenant. As such, in 1988 the Housing Act of that year brought in the Assured Shorthold Tenancy which allowed landlords to charge a "market rent" and, rather than the constantly self-renewing Rent Act tenancy, was effectively a fixed term let and once the term was over, allowed the landlord to regain possession for any reason on two months' notice and the issue of Court proceedings.

The rent control was very strict because it was set out as a "fair rent" in statute. This "fair rent" had to be submitted to the local Rent Officer (now part of the Leasehold Valuation Tribunal) who would assess it based on a geographical index which was in turn based on the Retail Price Index increasing over the previous registered rent, the calculation of which originally is now lost in the mists of time, or at least 40-year-old-plus statutory instruments. However it certainly hasn't kept pace with the market rates. In addition, if the landlord wanted to put the rent up, he could not do it even if the tenant agreed to it; he had to submit it to the rent officer for approval and then go through a notice procedure.

It is therefore not surprising that the Rent Act régime was referred to as "expropriation with compensation."

And even if the tenant fell into rent arrears, getting him out is tough in a Rent Act tenancy. Firstly, having served the correct notice, you must then show that one of the "cases" in Schedule 15 to the Rent Act 1977 apply. These are things such as rent arrears, using the premises for immoral purposes, breach of tenancy, and so forth. Once the case is made out, you must then show that it is reasonable in all the circumstances that a possession order should be made - for instance, if the arrears are low or the tenant is making concrete efforts to pay off his rent arrears, possession will be less likely to be ordered or a suspended possession order made. Then, you have to show that suitable alternative accommodation is, or will be likely to become available when the order takes effect. Needless to say, in today's straightened and overstuffed housing market, this is pretty difficult to show.

Before you ask, turning up with three tough pals and booting them out physically is both a criminal offence and a cause of action in civil court in the form of unlawful eviction. My former boss acted for a Rent Act tenant who was unlawfully evicted and secured damages of over £120,000.00. So now you know.

Needless to say, back in the day a lot of people tried to circumvent the Rent Act provisions by claiming tenancies were "licences," which the Courts usually saw through. Even nowadays, if you want to get a Rent Act tenant out your best bet is to offer him a lot of money to leave. I've heard that a Rent Act sitting tenant diminishes the value of a property by up to half, so guess how much a savvy tenant would be asking for...

If you are a Rent Act tenant, which is rare, as you would have had to have been there since before 1989 or have accepted an offer of similar alternative accommmodation from the same landlord (which is the way you get Rent Act tenancies starting after that date), then assuming the place is satisfactory for you, hang onto it! You will never get as good a deal on your accommodation again. To put this into perspective, I had a client in 2009 who was on a Rent Act tenancy in Weybridge in the Surrey commuter belt and despite earning £90,000 a year wage, he flatly refused to try to get onto the property ladder. Because where else in Surrey can you get a 2-bed house for £85.00 per week?

(It was £15.00 per week for several years before that because the landlord had forgotten to go and apply to put up the rent and had just started charging the higher rate unilaterally, then claiming rent arrears. Whoops.)


(IRON NODER 2011, 18/30)

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