Can i create a tenancy?

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    Can i create a tenancy?

    I work away from home alot and want to know if i can let out part of my property? I own first and second floor of a converted house. The second floor is self contained : bathroom kitchen living area/bedroom. There are 3 other flats 1 owner occupied, 2 let out.

    As you enter the first floor there is door to stairs leading to second floor area. It is this area i want to let out for 6 months.

    I occasionally need to live at my property with 2 rooms and bathroom on the first floor and would make the 2 areas seperate so that the new tenant would have exclusive access to the second floor. Does anyone know whether a tenancy agreement would be valid and therefore protection of the courts in case if things went wrong?

    #2
    If it is possible for the occupier of the second floor to exclude other people (like a lock on the door to the stairs) and they can live in the property it can be an Assured Shorthold Tenancy.

    Things to consider (off the top of my head).
    There's potential complications with capital gains tax on your property (which as your home is currently free of CGT entirely) if you rent part of it.
    If the property is leasehold the lease may not allow it.
    It isn't possible to limit the tenancy to six month's without the tenant's cooperation (if you do want to attempt that, agree that they will give you written notice to expire after six months immediately after they have signed the tenancy agreement, it might work).
    You'll need to make sure you can get insurance (your domestic policy won't allow it).
    What are you going to to about utilities?
    If you have gas you'll probably need an annual landlord's safety check.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Thanks jpkeates. Yes the tenant would have their own keys. So that would mean as AST i could issue S8 and S21 notices if the tenants were bad.

      Regarding the cgt implications. I probably need professional advice as i have no idea how that would work. I have lived in the property as my main residence for over 5 years and am only looking to let in the very short term.

      I would keep the utilities in my name and put in the tenancy agreement an amount for utilities to be paid/shared. I would advise council of the occupants for council tax purposes and apportion a share of that in the TA too.

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        #4
        There's no need to tell the council for council tax purposes, unless you are ending a single person's allowance.
        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

        Comment


          #5
          I'm not sure if this would work, but if you let the tenant have the first floor instead (and you keep the second floor for yourself) and you make a point of sharing kitchen and bathroom with them occasionally, you might be able to make them a lodger, which would be less of a risk if you get the wrong person. There may be some other conditions you would need to meet to ensure that a lodger agreement is sound.

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