Following our article in March regarding the proposed changes to the way landlords may obtain possession of Assured Shorthold Tenancies (ASTs), Laura Bushaway and Zoe Athill provide an update on the changes to Section 21 of the Housing Act 1988 as a result of the Deregulation Act 2015, which will come into force on 1 October 2015.
- A new prescribed form of Section 21 Notice (to terminate the AST) must be used for all new ASTs granted on or after 1 October 2015. The new form may be used but is not mandatory for existing ASTs.
- Where a tenancy is periodic, there will no longer be any need for a Section 21 Notice to stipulate the termination date as the last day of a period of the tenancy; 2 months’ notice will suffice.
- A tenant will be entitled to a refund of any overpaid rent where a tenancy comes to an end mid-way through a period.
- Landlords will not be able to serve a valid Section 21 Notice within the first 4 months of a tenancy.This means that landlords or their agents will no longer be able to serve Section 21 Notices at the beginning of the tenancy to terminate at the end of the tenancy (often 6 or 12 months later).
- There is a new time limit for possession claims which cannot be started more than 6 months from the date a Section 21 Notice is served.
- No valid Section 21 Notice can be given until the tenant has been provided with an energy performance certificate and a current gas safety certificate.
- For all new ASTs granted on or after 1 October 2015, the landlord (or its agent) must provide the tenant with a copy of the Department for Communities and Local Government’s booklet entitled “How to rent: the checklist for renting in England” which can be found at: https://www.gov.uk/government/publications/how-to-rent. Landlords will be unable to use the ‘no-fault’ possession procedure until they have done so.
- Retaliatory Eviction: Prevents a landlord serving a Section 21 Notice or invalidates a Section 21 Notice already served in certain circumstances where the local authority has served an enforcement notice on the landlord or where disrepair has been reported to the landlord by the tenant. In summary:
- Landlords will not be able to serve a valid Section 21 Notice within 6 months of the date of service of an enforcement notice by the local authority in relation to the premises.
- In addition, a Section 21 Notice which has already been served will be invalidated where (a) the tenant has made a written complaint to the landlord regarding the condition of the premises (or common parts) before the Section 21 Notice was served; and (b) the landlord has not provided an adequate response to the complaint within 14 days; and (c) the tenant has complained to the local authority which serves an enforcement notice in response to the complaint. The test is cumulative and therefore a Section 21 Notice will only be invalidated if all elements are met.
Whilst the changes may be welcomed by tenants who will have rights to greater information and whose landlords will be obliged to comply with certain minimum requirements in relation to the condition of the premises and energy performance, some of the changes will undoubtedly add to the regulatory burden for landlords of residential property.
There is little guidance as to what would constitute an ‘adequate response’ from a landlord in relation to retaliatory eviction and in practice this is likely to depend on the facts of each individual case. However, the simplification of the notice requirements in respect of periodic tenancies and introduction of a prescribed form Section 21 Notice should remove uncertainty for landlords around the correct termination date and may help make the requirements clearer.