Section 21 – the so-called no-fault eviction – has become the go-to route for landlords who need to evict tenants and take back possession of their property. But the political wind is changing, and it looks as though its days could be numbered. So, what happens next?
To say Section 21 has a bad press is something of an understatement. Reams of column inches have been devoted to tales of tenants forced out of their homes at the ‘whim’ of a buy-to-let landlord, while Panorama’s ‘Evicted for no Reason’ tugged at the country’s heartstrings, with emotional stories of families struggling in temporary accommodation following the issue of a Section 21 notice.
The concept of ‘no-fault’ evictions is also a hot topic in Parliament, with MPs from across the political spectrum echoing calls from homeless charities and other organisations for the abolition of no- fault evictions during debates in the Commons. The one-sided view of Section 21 echoes a lot of the tired stereotypes about to buy-to-let landlords, when in fact – as the RLA has said on many occasions – it is in landlords’ interests to keep good tenants in their homes.
Landlords can make all sorts of concessions to keep hold of reliable tenants and often have very good reasons if they do decide they need to regain possession. Indeed, despite the ‘no fault’ shorthand, research shows us that very often there is a fault on the part of the tenant. Landlords frequently use Section 21s as an alternative to the lengthy and complicated Section 8 process to evict problem tenants. Others are forced to regain possession of their property using Section 21 to sell it, as renting out a home is no longer affordable for them.
Some landlords may want to move back into the property themselves – or move a family member in. In short, there is a myriad of reasons. In addition to this, the issue is not as widespread as the noise it generates, with the 2015/16 English Housing Survey noting that, when asked about their most recent move, 73% of private renters said that their last tenancy ended because they wanted it to, with only 11% saying their landlord or agent ended the tenancy. Despite all this the calls for the abolition of Section 21 grow ever louder.
History of Section 21
Section 21 was introduced, along with the Assured Shorthold Tenancy (AST) by the Housing Act 1988. Under Section 21 landlords of an Assured Shorthold Tenancy were given the right to regain possession of their buy-to-let home after an agreed term – then six months – provided they served a property drafted Section 21 notice. This was a real game-changer for landlords who were used to long-term secure tenancies, sometimes passing down through generations, with few options if they wanted to evict. In fact, one of the less publicised benefits of Section 21 was that it actually made it easier for tenants to find homes to rent – essential with the arrival of the right to buy impacting on the availability of social housing. Before Section 21 powers were introduced private landlords were extremely risk averse – and often only willing to take on the most exemplary tenants – for fear they wouldn’t be able to get their property back.
The campaign for the government to abolish Section 21 has been rumbling on for some time and momentum is now building. At this time of housing crisis, the government can ill afford a mass exodus of landlords from the private rented sector. However, with almost a quarter of all households to be living in the PRS by 2025 they cannot afford to ignore the tenant vote, either. Change to Section 21 may be politically crucial when it comes to making longer tenancies a reality, in particular for families and older renters.
As discussed in the last issue of Residential Property Investor, landlords in Scotland landlords saw their no-fault eviction powers axed in 2007 by a government determined to do so despite fierce and widespread opposition. Now the Scottish Association of Landlords says landlords’ rights have been strengthened by the changes in some instances. Rules allowing landlords to evict as a result of rent arrears in Scotland are more stringent and there are 18 mandatory and discretional grounds for eviction – from the landlord wanting to move into the property to antisocial behaviour. A new tribunal system helps enforce these.
What happens now?
It is clear to the RLA that the government could not consider getting rid of Section 21 without serious reform of the court system and grounds, but landlords need to have one eye on the horizon. Change may be on the way and we need to be sure we are prepared.
RLA fighting for landlord in Section 21 case
The RLA is fighting to protect landlords’ rights under Section 21 – appealing a court decision ruling a Section 21 notice invalid because a gas safety certificate was served after the tenancy began. In the case of Trecarrell House Limited and Patricia Rouncefield, a judge initially granted the possession order to the landlord. However, a subsequent appeal by the tenant succeeded, on the basis of a precedent set in the Caridon Property Ltd v Monty Shooltz case. This case saw a court rule Caridon’s Section 21 notice invalid, despite the fact the landlord provided the tenant with a valid gas safety certificate less than two weeks after they moved in. The judge said if the gas safety certificate was not served on the tenant before they took up occupation then a Section 21 notice could not be relied on to regain possession, and the situation could not be resolved by serving one after the moving in date. The RLA is supporting Trecarrell House Limited at the Court of Appeal, on the basis that so long as the gas safety certificate is provided before the Section 21 notice is served, then it is valid. Papers were served earlier this month. RLA policy director David Smith, partner at Anthony Gold Solicitors said: “We are committed to supporting our members to challenge decisions which affect their ability to take back possession of their properties under Section 21.” Read more about this here.