How to spot a protected tenancy when conveyancing

Private tenancies in Northern Ireland are generally divided into two categories:

1. Those where tenants and landlords are free to agree the tenancy terms themselves; and
2. Those which are protected by legislation in an attempt to increase property standards.

The second category are known as’ protected tenancies’. Although, the Private Tenancies (NI) Order 2006, which came into effect on 1st April 2007, prohibited the creation of any new protected tenancies, it is estimated that approximately 5,000 are still in existence from before that date.

Regulation

These protected tenancies remain subject to statutory regulation, especially in relation to the amount of rent which can be charged. Other unique characteristics of these tenancies include greater security of tenure for tenants and the ability of tenants to pass on their tenancy to family members in certain circumstances. Accordingly, this has major implications for tenants, landlords and their legal advisers; especially when in some cases the level of rent which can be charged is as little as £1 per week (plus rates). This can come as a shock to both tenants and landlords alike.

Characteristics of a protected tenancy

Identifying a protected tenancy can be difficult even for legal professionals as it requires knowledge of the Rent (NI) Order 1978, the letting history of the property and the Net Annual Value of the property. Once a property falls under the Rent Order it remains protected even if the property is sold; thus requiring both solicitor and new owner to be aware of the provisions and impact of the legislation. Furthermore, there are circumstances where a property can move out of ‘protected’ status.