Model tenancy agreement for Scottish private residential sector published

Real Estate Alert

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On 18 October the Scottish Government published a model tenancy agreement for the new Scottish private sector residential tenancy regime, which comes into effect (under the Private Housing (Tenancies) (Scotland) Act 2016) on 1 December 2017. Residential leases under the new regime will be known as Private Residential Tenancies (PRTs).

Our article of 15 September on the 2016 Act highlights the key features of PRTs, and provides an at-a-glance comparison (in tabular form) between PRTs and private residential leases under the existing Scottish assured tenancies regime.

The Scottish Government's model tenancy agreement contains two categories of clause.

The first category (clauses 1-24) covers the core rights and obligations of PRTs. These include the mandatory statutory terms which apply to all PRTs, the repairing standard, and tenancy deposits.

The second category (clauses 25-39) covers discretionary terms of PRTs, which the landlord may or may not wish to include in the tenancy agreement. These include clauses governing how the tenant may use the property, such as a clause prohibiting the keeping of pets, and a clause prohibiting smoking.

As noted in our article of 15 September, certain classes of letting will be exempt under the new legislation and will not be PRTs. These include lettings of student accommodation by Universities, Colleges, and Purpose Built Student Accommodation ("PBSA") providers. One of the main implications of this exemption, is that whilst PRTs will be open-ended rolling tenancies, which can only be terminated by landlords if specific statutory grounds allowing termination exist, Universities, Colleges, and PBSA providers will be able to enter into fixed-term lettings under which they can recover possession at the end of the student term.

Although the Scottish Property Federation has argued that large scale private sector Build to Rent accommodation should also be exempt from the 2016 Act (thus allowing fixed term tenancies to be offered and, in SPF's view, encourage investment), as things currently stand, lettings of accommodation in this asset class will be PRTs.

The new model tenancy agreement is available here on the Scottish Government's website. The model tenancy agreement is accompanied by detailed supporting notes and an "easy read" guide.