If you've let property in the UK at any point since 1989, you've used an Assured Shorthold Tenancy (AST). It's the standard residential tenancy contract for England and Wales, and most landlords have signed dozens of them without ever reading the small print.
Two things make ASTs worth understanding properly in 2026. First, the Renters Rights Act has just rewritten parts of how they work. Second, knowing your AST helps you decide whether it remains the right contract for your property.
Here's the plain-English guide.
What an AST actually is
An Assured Shorthold Tenancy is the default residential tenancy contract in England and Wales. It was created by the Housing Act 1988 and has been the standard since 1989.
It gives the tenant possession of the property in exchange for a defined rent for a defined term. The tenant has security of tenure during the term. Meaning the landlord can only remove them via specific legal grounds. But the landlord retains the freehold (or leasehold) and significant control over how the property is used.
Before 1 May 2026, the standard structure was a 6 or 12-month fixed term followed by a rolling periodic tenancy. After the Act, the fixed-term option has been removed entirely. Every AST is now periodic from day one.
The key clauses every landlord should know
Most standard AST templates contain 40-50 clauses. A handful do most of the work.
1. Rent and rent reviews
The rent figure, payment frequency, and any rent review mechanism. Under the Act, rent increases are now capped at one per year and challengeable at the First-tier Tribunal.
2. Deposit and protection
Maximum 5 weeks rent (or 6 weeks if annual rent exceeds £50,000). Must be lodged in a government-approved deposit scheme within 30 days. Failure to protect carries automatic statutory penalties.
3. Repair obligations
The landlord is responsible for structure, exterior, plumbing, heating and electricity. Tenant covers minor day-to-day items. The Decent Homes Standard now applies on top of these baseline obligations.
4. Permitted use
The property must be used as the tenant's only or principal home. Subletting (including listing on Airbnb) is normally prohibited without written consent.
5. Termination grounds
Pre-May 2026, Section 21 allowed no-fault termination after the fixed term. Post-May 2026, Section 21 is abolished entirely. Landlords now rely on Section 8 grounds: sale of property, moving back in, persistent arrears, anti-social behaviour, or major refurbishment.
What's changing under the Renters Rights Act
Even if you've used ASTs for decades, the post-1-May 2026 version is meaningfully different. The five biggest changes:
- Section 21 no-fault eviction is abolished
- Fixed-term ASTs become rolling periodic by default. Tenant can leave at any time with 2 months notice
- Rental bidding is illegal. Landlords must advertise an asking rent and accept it
- Annual rent reviews are capped and challengeable at the First-tier Tribunal
- All landlords must register on a national database; properties must meet the Decent Homes Standard
If your AST was drafted before May 2026 and runs past that date, the new statutory rules override anything in your contract. The contract stays in force; the rules have changed around it.
Why some landlords are moving away from ASTs entirely
Most London landlords will keep using ASTs because they own a single property and an AST remains the simplest contract. But for landlords who can no longer accept the new risk profile, alternatives now look more attractive than they did 12 months ago.
Two alternatives sit outside the Act:
Guaranteed rent (corporate let)
When the tenant is a company rather than an individual, the AST framework doesn't apply. Different legislation governs the relationship. This is the legal basis of our guaranteed rent product. We sign the lease as a company, you receive a fixed monthly payment, and the Renters Rights Act doesn't apply.
Short-let / serviced accommodation
Stays under 90 nights aren't ASTs. They're licences for short-term occupation, governed by different rules including London's 90-day cap. Short-let management takes the property out of the AST framework entirely.
Both routes are completely legitimate. Both remove most of the AST-specific risks landlords are worried about. Both deliver income that. For properties in the right postcodes. Meets or exceeds long-let returns.
How to decide what to do with your AST property now
- 01If your current AST runs past 1 May 2026, accept it has converted to periodic and update your records
- 02Review your tenant. If the relationship is solid and rent is paid on time, the change is mostly procedural
- 03If your tenant is on a problematic AST, take advice on the new Section 8 grounds for possession (it's slower but possible)
- 04For new lettings, consider whether AST, short-let or guaranteed rent is the best fit for your property in 2026
- 05Update your buildings and contents insurance. Many policies are written against ASTs
Have a question about your property? Speak to the Taj Cribs team. We manage properties across the whole of Central London and offer free valuations with no obligation.
This article is general guidance only and does not constitute legal advice. The Renters Rights Act and AST law are complex; landlords should consult a qualified solicitor for advice on their property.
