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Stumped for an answer!

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A letting agent approached me this morning asking if i knew the answer to the following:

Two men jointly own a property and one wants to occupy and rent it as the tenant together with his extended family of partner and two children as their main residence i.e. on an AST.

Now I don't think you can be both landlord and tenant for what appears to be obvious reasons so how would you go about this?

I suggested an informal arrangement but the owner who is not going to occupy wants it on a formal footing.

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