A new survey suggests that getting rid of Section 21 ‘no fault’ eviction notices would see leaving the industry in large numbers.
Landlord Action, the eviction and housing law specialists, commissioned research in the wake of a government consultation into possible reform of the private rental sector (PRS). The results have yet to be published but banning Section 21 evictions has been mooted given a perception that they give landlords too much power.
“Section 21 gives landlords and mortgage providers the reassurance and flexibility to recover their asset if they need to,” says Paul Shamplina, Landlord Action founder and eviction specialist.
“To abolish it, or even dilute its current use as has been suggested, will require significant reform to Section 8 which offer reassurances to landlords that if they had to use the Section 8 route under grounds for rent arrears, moving back into the property or selling it, there would not be significant delays in the court process. With this, we are likely to see a further cut to supply of rental properties as landlords will consider buy-to-let too great a risk.”
The Landlord Action survey comes up with some revealing findings:
- 73% of landlords surveyed said they have had to serve a Section 21 notice, with 56% using it because their tenant was in rent arrears
- 10% said they used a Section 21 because the tenants requested the landlord obtain a possession order
- 5% used a Section 21 to refurbish the property
- 5% used a Section 21 to sell the property
- 2% wanted to move back into the property
- 6% were ‘retaliation evictions’ – where a tenant had complained about disrepair
At 42%, a significant number of landlords said they had had to go to court after using Section 21, although for 43%, the tenants vacated the property. The possibility of establishing a ‘Housing Court’ to replace the current fragmented system that deals with disputes was another part of the government consultation.
The Tenant Fees Bill recently passed through Parliament, meaning that after it becomes law on 1 June, upfront letting and agency fees cannot be passed onto the tenant. If they are, they must be repaid within 28 days, otherwise a Section 21 will be ineffective.
