Housing Associations / Policy

Hand-back Procedure at the Expiry of the Lease

Summary

This page sets out the procedure to be followed at the end of the lease when the property has been let to a sub-tenant on an assured short-hold tenancy.

Further Information

Hand Back Procedure at the end of the Lease

At the end of the lease term an owner has the choice to enter into an extension to the lease for the property and if so the procedure for granting an extension to the lease should be followed. To do this the RSL should give the owner a written notice before the last month of the term of the lease so that the landlord can grant an extension to the lease of the property for the period requested in the tenants notice up to a maximum of six months. This period starting on the day after the end of the term of the lease and being on the same terms as the original lease, apart from the fact that the tenant has no right to claim a further extension to the lease.

Alternatively an owner may decide that he wants the property returned to him. The lease agreement gives permission for the owner during the last three months immediately preceding the determination of the lease to affix and retain a ‘for sale’ or re-letting notice on the property and upon giving a minimum of 48 hours notice to the tenant send people with written authority to view the property by appointment.

• In order to finds out the owner’s intentions regarding the lease she/he should be approached at least four months prior to the expiry of the lease.  
• If the lease is to be extended for a period of up to six months then the tenant (i.e., RSL) should give the owner a written notice before the last month of the term of the lease to enable the landlord to grant an extension to the lease of the property.
• If there is a sub –tenant still living in the property then they should be informed about the owner’s intentions as soon as possible and a discussion should take place with them to find out whether they need help to find other accommodation. A reminder of the correct notice procedure to give at least four weeks notice in writing, should be part of the discussion. If the sub-tenant requires help they should be advised in writing as well as verbally to contact their local Council, and a copy letter be kept by the RSL detailing this. Arrangements with the local authority regarding re-housing responsibilities should form part of the framework agreement between them and the RSL and the RSL should also contact the local authority to tell them that the property is to be returned to the owner, and that the sub-tenant may be contacting them.
• In any case a Notice should be served under section 21 of the Housing Act 1988 to protect the interest of the RSL. Under section 21 a landlord must give a minimum of two months notice in writing. Extra days should be added if the notice is served by post as the two months start when the tenant receives the notice. This action should be explained to the sub-tenant and all through the process of re-housing liaison with the sub-tenant should take place. If there is no agreement with the Council and it looks as though the sub-tenant will not be re-housed by the Council then the RSL may be able to find other accommodation for them through leasing another suitable property, or in some other way.
• If accommodation has not been found then when the section 21 Notice expires after two months the RSL should again interview the sub-tenant to find out the latest position and so that a decision can be made about whether the RSL should proceed in the County Court. Every effort should be made, however to offer advice and guidance on how to find alternative accommodation and about the alternatives that are available.
• If the end of the lease is approaching and the property is empty the tenant, (i.e., RSL) according to the terms of the lease is entitled to determine the lease at any time by giving the landlord (owner) not less than 28 days notice in writing, or, in the last calendar month of the term by giving the landlord (owner) not less than 14 days notice in writing. Note that notice can also be given immediately at any time by giving the landlord notice in writing in the event that any asbestos is discovered within the property or the building.  
• However prior to the cessation of the lease the owner will want to look over his property with regard to its condition and time should be allowed for this to happen prior to the expiry of the lease.
• In the six weeks or so before cessation of the lease the owner needs to make an appointment (giving at least 48 hours notice) to inspect the condition of the property. This visit should be accompanied by a member of the RSL.
• The property will be inspected to compare the condition of the property against the original schedule of condition and the photographs, and with regard to the nature of the type of lease that was taken on and the responsibilities of the owner, tenant and sub-tenant.
• Owners must accept that normal wear and tear will occur and that the tenant is not liable to keep the premises or the fixtures and fittings in a better state of repair than is evidenced in the Schedule of Condition. The property may have been redecorated several times since the commencement of the lease (and the carpets and furniture where they are provided may have been replaced). The property may need redecorating again and there may be changes due to fair wear and tear which the agent would not put right but any damage done by a tenant or due to neglect should be put right by the RSL or other managing agent.
• Once the property has been assessed for hand-back some works may be required. If these are ones for which the tenant is liable the works may be undertaken or a cash settlement offered to the owner. End of lease photographs should be taken and agreed (signed and dated) with the owner as a true record of the condition of the property.
• When handing back a property the RSL should prepare written information to terminate any liability to a property from date of hand-back, take meter readings and the owner should be asked to sign the paperwork to certify that this has been undertaken.
• Correspondence should be sent to council tax and the relevant utility companies informing them that the property has been handed back with details of the owner and their home address.   
• A bill should be given to the sub-tenant for any repairs for damage for which he is responsible. Damage or neglect of the property can be minimised by ensuring that regular inspections have taken place throughout the tenancy.    

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Ministry of Justice