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Fixed Term Tenancies

All new public sector housing tenants and any existing tenants who transfer to another property or who renew or update their tenancies will sign up to a fixed term tenancy. The majority of fixed term tenancies are for 5 years, although there are some instances when tenants are offered an introductory tenancy for 1 year or less. In advance of the end of each fixed term tenancy, the tenant’s circumstances are reviewed, including their financial circumstances, to determine whether another tenancy can be offered.

Brief Background to Fixed Term Tenancies

Since 2014, general needs public sector tenancies have been granted on a fixed term basis. The tenancy expires on a fixed date set out in the tenancy agreement and there is no obligation on the landlord to grant a new tenancy beyond this date.

The aim of a fixed term tenancy is to;

  • provide a natural break at which point both the landlord and the tenant may reconsider their respective positions and decide whether a new tenancy should be entered into

    and

  • allow an opportunity to adjust the terms of the tenancy if required (e.g. a change to the rent terms or to downsize to a smaller property)

It is important to note that sheltered housing (or older persons housing) tenancies are not granted on a fixed term basis.

Offer of Tenancy to new tenants

All housing waiting list applicants who are allocated general public sector housing will normally be offered a 5 year fixed term tenancy. Housing providers may choose to issue a shorter duration fixed term tenancy for new tenants from the Housing Waiting list to ensure the new tenant is conducting their tenancy as required.

When tenants are offered a new tenancy, their housing provider will inform them in writing about what they should expect to happen before their tenancy is due to expire at the end of the fixed term period.

Review of your tenancy

Approximately 12 months before the expiry of a fixed term tenancy, the housing provider will send a reminder letter to the tenant confirming when their tenancy expires, and that a review of their circumstances will commence in 6 months’ time.

Approximately 6 months (and not less than 3 months) before the expiry of a tenancy,  the housing provider will send their tenant a review form to complete and return to establish whether they remain eligible for public sector housing, or whether they are required to pay increased rent to reflect any change(s) in their circumstances since their tenancy commenced.

The review will consist of an assessment of tenants’ circumstances including a declaration of income and savings/financial assets against the current eligibility criteria (at the time of assessment) for access to general public sector housing.

Assessing household income

When fixed term tenancies are reviewed, household income is assessed against the thresholds shown here:

No. of children (dependent)Maximum Gross Income
Single applicantJoint applicant
None £34,500 £38,000
One Child £40,000 £43,500
Two Children £43,500 £47,000
Three or more children £47,000 512410
Moving Annual total 620949 593676

If a tenant’s income continues to meet the eligibility criteria for public sector housing and falls within the above thresholds then, subject to a satisfactory tenancy history, a new tenancy will be granted for a further five years and weekly rent will be charged at the normal rate.

If a tenant’s circumstances have changed, and they no longer meet the eligibility criteria for public sector housing, then subject to their particular circumstances, they may be granted a new fixed term tenancy on different terms or be given notice to leave a property.

If a tenant is granted a new fixed term tenancy on different terms, their new rent will be calculated by applying an increase that is equivalent to the percentage amount by which they exceed the maximum income threshold for their household category.

Please see the attached document for further information about how rent increases are calculated.

Assessment of savings and financial assets

At the point of review of a fixed term tenancy, the calculation of household income will exclude any savings and financial assets up to the amount of £30,000.

Any savings and other financial assets in excess of £30,000 will be considered as additional income. Savings, gifts, inheritances, investments and property assets are all taken into account when determining the amount of savings and other financial assets available to you. The sum of any savings/financial asset over £30,000 will be divided by 5 (usually the number of years for which the next tenancy will be active for) and added to a tenant’s annual household income amount to be assessed at the fixed term tenancy review.

Example 1

Column AColumn BColumn CColumn DTotal
Annual gross household salary Total household savings at point of review

Savings subject to assessment (i.e. total amount above £30K)

Excess savings divided by 5 (Column C divided by 5)

Total amount to be assessed (Column A plus Column D)

£27,500 £35,000 £5,000 £1,000 £28,500

Example 2

Column AColumn BColumn CColumn DTotal
Annual gross household salary Total household savings at point of review

Savings subject to assessment (i.e. total amount above £30K)

Excess savings divided by 5 (Column C divided by 5)

Total amount to be assessed (Column A plus Column D)

£35,500 £60,000 £30,000 £6,000 £41,500
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