PROPERTY OWNERS SHOULD BE AWARE THAT THERE ARE DIFFERENT TYPES OF LETTINGS AVAILABLE TO THEM.
1. LETTING UNDER THE RESIDENTIAL TENANCY ACT 2004 – CREAM LEASE
The standard tenancy agreement is under the Residential Tenancy Act 2004. Most lettings will come into this category. The tenancy must be registered with the PRTB and the landlord and tenant are governed by this legislation. Ensure that you are aware of your rights and obligations within the legislation. If you have not put a letting agreement in place the tenancy is automatically under the RTA 2004 and must be registered.
2. PART BUSINESS LETTINGS – LILAC LEASE
This is for Residential Tenancies who use the premises for Business Related Activities either in part or full. e.g. Lettings to people who are in a certain occupation that they bring home work, use a phone or computer for business purposes. It is vital that the use is established at the outset and under this type of lease you must not allow the tenancy to be any longer than 4 years 9 months.
This type of a lease/tenancy is not within the 2004 Act and therefore does not have to be registered but must not be used to avoid registration.
3. LICENCES AGREEMENTS – BLUE LICENCE
This is an agreement to give a licence to your occupier, suitable for day to day letting. It must be seen to be operated as a licence e.g. the Property Owner holds a key to the property and occasionally enters the premises and can move the occupant to another property as necessary. This Licence is outside the 2004 Legislation and is a useful type of letting but should be explained to the prospective licensee prior to the letting and should not be used to avoid registration.
The above letting agreements are available for members.
THESE LEASES AND LICENCES ARE FOR GUIDANCE ONLY AND EACH PROPERTY OWNER MUST CONSIDER HIS OWN SITUATION AND DECIDE WHICH FORM OF LETTING SHOULD BE USED.