Restricted Contracts under the Rent Act 1977

Security of tenure of occupiers with restricted contracts, their rights, and the situations where restricted contract status can be lost.


What is a restricted contract

Security of tenure of tenants with restricted contracts

The right to a reasonable rent

Reconsideration of rent after registration

Situations where restricted contract status is lost

Possession for contracts made before 28 November 1980

Possession for contracts made after 28 November 1980

Lettings that cannot be restricted contracts


What is a restricted contract


The Rent Act 1977 conferred limited security of tenure on certain residential occupiers who did not qualify for a regulated tenancy.


Restricted contracts are defined in the Rent Act 1977 as as 'a contract... whereby one person grants to another person, in consideration of a rent which includes payment for the use of furniture or for services, the right to occupy a dwelling as a residence'.[1]


A restricted contract can be a tenancy or a licence. The security of tenure is the same for both, and the information here applies equally to both.


Restricted contract occupiers fall into two categories:


those who pay rent which includes payment for furniture or services



those with resident landlords




The number of people with restricted contracts is decreasing, as no new restricted contracts can be created since the Housing Act 1988 came into force on 15 January 1989. Any change in the terms of a restricted contract letting since 15 January 1989 is likely to have ended the restricted contract.


Furniture


A tenancy which does not fall into any of the exceptions to a regulated tenancy is a regulated tenancy even if the premises are furnished.