At the end of 2017, the old residential tenancy known as a short assured tenancy (SAT) was replaced in Scotland by the Private Residential Tenancy, or PRT. The headline difference is that the new PRT has no end date, and landlords cannot give tenants a ‘no fault’ notice to quit. Instead, they need grounds such as rent arrears or antisocial behaviour to evict them.
Giving tenants greater security is a defined intention of the PRT, so that’s not the unintended consequence. The problem is the practical impact in the rural context. For example, farmers who grant a six-month let and then take back the property for harvest or lambing can no longer do this. To provide accommodation for seasonal workers, they may have to let the property sit empty the rest of the year.
Another example is where cottages are next to farming infrastructure or the farmhouse and the relationship with a tenant is difficult. Unless the farmer can show grounds for eviction, they may be stuck with a bad neighbour.
In addition, there’s an issue for landlords where, under current leases, their tenant farmers are allowed to grant short assured tenancies. Unlike with SATs, a PRT granted by a tenant farmer to a sub-tenant survives the end of the farm tenancy.
Let’s say the tenant farmer grants a PRT shortly before his own farm lease expires. Under the new system, the landlord is deemed to have granted the PRT himself on the same terms. So, even if the sub-tenancy was granted to a friend on a soft rent, the landlord is stuck with the arrangement and the mate’s rate.
So, how can landlords protect themselves?
It depends on the circumstances. For example, if you still have tenants on a tenancy from before December 2017, it may be worth sticking with the status quo (it’s only new tenancies since December 2017 that are PRTs).
On the other hand, if farming tenants’ current leases allow them to grant SATs (and therefore PRTs), the status quo could put you at risk.
If any of this may affect you, it’s best to take advice rather than sit back and hope for the best. Doing nothing now could be costly later on.
