On 15 April, the Secretary of State for Housing Communities and Local Government, James Brokenshire, made the incredible announcement that the Government is to abolish section 21. This will reverse the reforms introduced in the Housing Act 1988 when the Government led by Margaret Thatcher revolutionised a stagnant private rental market. At that time, private rentals accounted for less than 8% of all households in England. That figure has dramatically increased to 19%.
The removal of no fault evictions is a significant step, says the Government. The intention is to bring to an end the right of private landlords to require tenants to uproot from their homes with as little as eight weeks’ notice after the fixed term contract has come to an end.
It is a bold move by the Government, which is certain to annoy many of its private buy-to-let supporters. However, with the increase in the private rental market, perhaps it has realised it must also appeal to its supporters who are now private rental tenants.
The devil will be in the detail, and the Government is carrying out further consultation. But there is no denying it is trying to overhaul the housing sector to
- enhance the rights of tenants
- give tenants longer tenancies and increased security
- reduce homelessness
- increase the housing supply
- reduce the number of empty properties
- drive up standards
The section 21 procedure can only be used to bring the assured shorthold tenancy (AST) to an end at or after the contractual term of the tenancy. This will usually be on expiry by effluxion of timebut it could be on the expiry of a break notice.
If the section 21 procedure is available, it is usually the preferred option for private landlords as it is speedier, more cost effective, and the court is obliged to make a possession order without the landlord needing to establish grounds. Hence why it is often referred to as the ‘no fault’ eviction. A landlord can recover possession for no ground or reason, and the tenant is faced with having to find alternative accommodation.
Section 21 – pre-conditions to service
The Government has chipped away at the service of section 21 notices, and over the last few years has introduced additional pre-conditions. Accordingly, a section 21 notice cannot be served where:
- the tenancy deposit scheme has not been complied with
- the landlord failed to provide valid EPC and gas safety certificates at the commencement of the tenancy
- the landlord is in breach of the obligation to provide prescribed information, comprising the version of the document entitled “How to rent: the checklist for renting in England”
More recently, a landlord could be prevented from serving a section 21 notice where
- it demanded a prohibited payment from the tenant [for example payment of a letting fee]
- breached the rules on holding deposits
To prevent retaliatory evictions, moreover, section 21 notices will be invalidated where the tenant has made an official complaint about the condition of the property before the section 21 notice was served.
Section 8 notices
It is not all bad news for landlords. The Government has also announced an intention to amend the section 8 eviction process so that where the landlord has a legitimate reason to do so, the landlord will regain possession of the property where
- they wish to sell it or
- move into it
The Government has also promised extra resources and an expedited court process. Its consultation on the creation of a dedicated housing court has closed, and the response is expected at the end of 2019.
A further consultation has started. The Government is anxious not to disturb the supply of private rented accommodation. Organisations such as Residential Landlords Association has not reacted favourably in the immediate aftermath of the announcement. They point to the recent tax changes, increased regulation and the advance of local licensing schemes which, they say, will impact upon the buy-to-let market. Some landlord associations believe it is only a matter of time before the Government re-introduces rent control.
Housing and the supply of affordable housing is a hot topic in Parliament, and if there is an adverse impact on the market, it’ll quickly be felt by housing associations who will be expected to make up the shortfall. This remains to be seen, but the Government has a firm commitment to address section 21 notices, which it says is one of the largest causes of family homelessness.
Similar plans have been revealed for Wales andScotland has required landlords to give a reason for ending tenancies since 2017.