Abolishing S21 without S8 fully ‘fit for purpose’ will have dire consequences

by Paul Shamplina

11:02 AM, 16th April 2019
About a month ago

Abolishing S21 without S8 fully ‘fit for purpose’ will have dire consequences

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Abolishing S21 without S8 fully ‘fit for purpose’ will have dire consequences

Abolishing Section 21 without making Section 8 fully “fit for purpose” will have dire consequences on our housing supply.

Yesterday (15th April 2019), the government has outlined plans to consult on new legislation to abolish Section 21 in a bid to end so called ‘no-fault’ evictions. Although this is not a surprise move, it is one that, if goes ahead as suggested (i.e. full abolition of Section 21), will be game-changing for the private rented sector.

As I have said for many years, the vast majority of landlords only evict tenants as a last resort. At the end of the day, a landlord doesn’t let his property just so he can subsequently evict the tenant, there is always a reason, so the term no-fault is moot. When the property is let, it is an active decision made by the landlord. Unfortunately, circumstances change, for both landlords and tenants, but that’s what most people like about the PRS – its transient nature.

Removing the ability to evict with Section 21 will undoubtedly make any prospective landlords very nervous about embarking on the world of buy-to-let and could encourage existing landlords to exit the market, thus compounding the housing shortage crisis. I also believe we could see a surge in landlords serving section 21’s in the near future, as this could be a step too far, especially for the smaller landlords, which unfortunately will result in more evictions.

I do fully understand the need for families to have greater security and be able to put down roots, but there are several factors within this proposal that need to be carefully considered before an outright ban is implemented.

Changes to Section 8 and Court Processes

It was reported by Citizens Advice that supposedly 141,000 people have been handed eviction notices since laws to ban revenge evictions were introduced in 2015.  I just don’t understand how they have collated this information when non-fault means the landlord would not have given a reason.

No-one knows exactly how many Section 21 notices are served every year.  However, what we do know is that the most common reason for doing so is rent arrears, as was the case for 56% of landlords who responded to our survey last year.

In this instance, the reason landlords use Section 21 to gain possession rather than Section 8 as was intended, is because it is typically quicker.  Landlords have little faith in the current court system and few anticipate being able to pursue rent arrears, so most take the decision to forfeit recovering lost rent and just to get their property back as soon as possible so they can re-let.  Section 8 also comes with the added risk that tenants can counter-claim, therefore delaying the process further.

The announcement said that “Ministers will amend the Section 8 eviction process, so property owners are able to regain their home should they wish to sell it or move into it.”

In my view, if Section 8 is going to have to be relied on more heavily, it must be “fit for purpose” and any changes and their application need to be carefully considered.  Clearly, if a landlord is going to need strong grounds for possession, there are going to be a lot more court hearings. So, my question would be, are there going to be a lot more judges and resources to handle this increased workload?

The government has said that “Court processes will be expedited so landlords are able to swiftly and smoothly regain their property in the rare event of tenants falling into rent arrears or damaging the property”.  However, in truth, we don’t know how ‘rare’ rent arrears cases are because most landlords are writing them off via use of Section 21.

So, in that respect, perhaps greater use of Section 8 might be a positive thing as there will then be more accurate records of rent arrears cases.  However, the government must then assist landlords by ensuring money orders are registered as CCJs.  This will not only act as a deterrent to tenants who regularly fall into arrears and simply move on, but also enable landlords to pick up on defaulting tenants from their referencing.

Finally, what about all those cases which are less black and white? The cases where the tenant does pay the rent, eventually, but it is always late, refuses to give the landlord access and fails to communicate regularly, leaving the landlord with no choice but to pay the mortgage out of his own pocket until the tenant coughs up? My point is, it is not always one reason why a landlord decides to serve notice, it can be series of reasons which have built up over time, leading to a breakdown in communication. Where will those landlords in that situation stand?

Landlords are feeling very downtrodden at the moment and it’s easy to see why – they haven’t even started to feel the effects of the tenant fees ban yet and already have been hit with yet another potentially industry-changing piece of legislation.

Whatever the outcome, we know it isn’t going to happen quickly as there is a consultation first, but since there is much at stake for everyone involved in the PRS, I would urge the government to fully engage with the industry to understand the consequences of legislative change and consider dilution of Section 21 over removing the use of Section 21 altogether.

So finally, as a landlord, I urge you to complete the consultation on Section 21’s when its released by the Government, to have your say.

Contact Landlord Action

Specialists in tenant eviction and debt collection. Regulated by The Law Society.


Comments

Monty Bodkin

14:12 PM, 16th April 2019
About a month ago

"It was reported by Citizens Advice that supposedly 141,000 people have been handed eviction notices since laws to ban revenge evictions were introduced in 2015.  I just don’t understand how they have collated this information"

I think it was from a survey of 2000 renters and they have taken the percentage figures from that (a fraction of a %) and just extrapolated it onto 4.5 million private rented households over the timeframe.

It would be interesting to know if they asked the landlord if rent arrears, anti social behaviour, damage to property, refusing access, won't communicate etc was also a factor in that tiny fraction of revenge evictions.

Old Mrs Landlord

16:42 PM, 16th April 2019
About a month ago

At the moment, Section 21 notice is the only route open to a landlord who needs or wishes to sell a tenanted property. The government consultation paper on which all these press reports are based proposes amendment of Section 8 grounds to include landlords selling, but only after two years into the tenancy. This means default minimum two year tenancies unless other Section 8 grounds apply. One of the main reasons so many landlords are currently selling up is the change to the taxation regime which makes properties unviable in certain cases. Thus the government is robbing these landlords of their one means of avoiding repossession or even bankruptcy, in an attempt to cure a problem which it has itself created. Paying attention only to the tenant representatives' insistent demands and failing to include the people who provide the accommodation in their consultations means the government have no overview of the private rental sector and are constantly tinkering at the edges with consequences unforeseen by the authorities but predictable by landlords who have not been listened to. With no lessons learned from history and no opportunity for one piece of legislation to bed in and its results be appraised, another follows hot on its heels sending contradictory signals to the poor bewildered landlord who is trying to keep up and do the best to provide a good service to tenants and make a modest profit for all the work and time involved. Surprise, surprise, the private rental sector is shrinking even as demand increases.

Whiteskifreak Surrey

8:20 AM, 17th April 2019
About a month ago

I believe this is a well planned action to completely get rid of PRS. IT might be sponsored by huge corporate landlords, who want to snap the properties cheaply from bancrupted landlords who are unable to sell due to two years restriction.
Otherwise I cannot imagine why there is nobody in the government with at least two cells in their brains to see what is happening in the middle of the greatest housing crisis in the modern time.
I suppose it is a high time our New Landlord Alliance did something about it. I am not even sure what happens with their action on Shelter?

Larry Sweeney

9:00 AM, 17th April 2019
About a month ago

Replying to whiteskifreak Surrey.
We do update members on our actions and campaigns and will do so shortly. We obviously cannot reveal all our strategies on a public forum.
Answering your points as best we can here, we started a very high profile campaign against Shelter which is ongoing. Unlike the NLA and RLA we took the fight to shelter, meanwhile the RLA were publishing Shelter poetry.
We are far from finished with Shelter but as everyone knows Events have overtaken us with the abolition of Section 21 which is coming and which we forecast, see our website. One must now ask why the Government /councils give money to shelter since their 'raison d'etre' goes with section 21 . They dont house anybody nor will their advise be needed.
We have written to the MOJ and submitted a document re changing the regs re posession. Allowing all certificated enforcement agents to execute posession orders from the courts.
Finally re Section 21, we have no control over government policy, nor do the other organisations, however on that point we will imminently make a statement here
On p118.
I hope that answers your question and believe me, I completely get your frustration with the current state of affairs.

PJB

9:59 AM, 17th April 2019
About a month ago

Reply to the comment left by Larry Sweeney at 17/04/2019 - 09:00I certainly agree that S.8 should be beefed up so that wilful damage, theft, etc. be treated as criminal offences. If one hires a vehicle and it is returned without a radio or slashed seats, the treatment for these offences are often taken far more seriously than offences committed by rogue tenants.
S.21 has proven beneficial for some tenants where the landlord has chosen not to issue an S.8 notice. Because a S.21 is a "no fault" eviction, councils and housing trusts accept that the outgoing tenant has not made him/herself intentionally homeless and agree put them on a rehousing programme. This would not be the case if an S.8 notice had been issued.
I suspect that removing S.21 will cause havoc in the education sector where students in HMOs could no longer be legally evicted at the end of an academic year. The students that signed up to occupy a property for the next year could find themselves homeless with the landlord still duty bound to provide suitable accommodation.

Pru Counsell

10:47 AM, 17th April 2019
About a month ago

Reply to the comment left by Monty Bodkin at 16/04/2019 - 14:12
I consider myself to be a responsible landlord. I have owned properties in the South West for the last 15 or so years. I worked for a small supporting people organisation until 2012 when my employer retired but still kept my houses for private rent. During the period 2012 – 2016 I had what could be called bad tenants. I won’t go into detail but suffice to say I was left with rent debts, rubbish and redecoration, not to mention rats and fleas. Even with the support of my solicitor I was unable to claim any monies back from my tenants – how could I when they had no income! and eventually spent about £2.3k on repairs and lost £1.6k in unpaid rent which was mostly accumulated after I had given Section 21 notices. In one case it took me 3 months to evict the tenant, in others they left voluntarily, but still owing rent. I issued Section 21’s so I could put my properties back in to lettable condition, showers and shower curtains were missing, a kitchen cupboard was taken, carpets ripped up – you name it!

After renovating, redecorating and repairing the properties I approached my local council and was appointed a Housing Officer. Through her I was able to rent my properties and have a bond with the council for one month’s rent. Also the rent they pay or ensure is paid is for more than the rents I had previously asked. I have now had tents this way for the past 2.5 years and so far no problems.
My Housing Officer contacts me from time to time and inspects the properties several times a year.

So far as the proposed new rental regulations go I think if you are a good landlord you do not need to worry, but regrettably there are so many rogues landlords they get us good ones a bad name causing the need for this new legislation.

Whiteskifreak Surrey

10:54 AM, 17th April 2019
About a month ago

Reply to the comment left by PJB at 17/04/2019 - 09:59
Re Students: We (LLs who rent to students) shoudl put pressure on the Universities so they can do something about it. We always had a one year agreement (AST for 4 students, as acceptable by a lender) and if the students decided to stay (notifying us about such an intention in February), we will issue a new agreement for next academic year. Will that not be allowed now?

Dylan Morris

11:36 AM, 17th April 2019
About a month ago

If seems if this removal of Section 21 goes ahead we will be completely at the mercy of the Court judges. We will have to convince a Judge that we have a genuine to reason why we need to sell, in order to seek his approval for a possession order. This will become a discretionary ground. Say a landlord wants to sell up and move overseas. A judge will have in front of him what is perceived as a rich landlord who wants to live in the sun and a poor tenant who is a victim and being made homeless just because of the landlord’s greed. Guess who the judge is going to side with ?
We will have to go armed with pages and pages of documentation to prove anti social behaviour. Council documents and police reports etc, etc. Guess who the judge will probably agree with ?
Arrears proof will have to be extensive and landlord will have to show he/she has been reasonable and helped the tenant etc, etc.
Given the supply of rental housing will reduce, judges will be under massive pressure from the authorities not to issue possession orders.

Monty Bodkin

13:08 PM, 17th April 2019
About a month ago

Reply to the comment left by Dylan Morris at 17/04/2019 - 11:36
The ground to sell will be mandatory. (At least at first!)
Agree with the rest- basically the shambles it is already.

Mick Roberts

15:09 PM, 18th April 2019
About a month ago

I've issued & followed up about 7 Section 21's the last 8 years or so.
All for rent arrears & damaging houses.
The last 2 Section 21's with evictions has been purely cause of Nottingham Selective Licensing http://www.selectivelicensingtruth.co.uk & Universal Credit.
The first 4 out of 5 from memory was because of the benefit cap-A change bought in by Government on EXISTING families that ALREADY HAVE the kids.
And the last 2 evictions was PURELY cause of new legislation by Nottingham Council & interference, change of rules from the Government.
So my point is, I we end up evicting not cause we want to, but from bad tenant behaviour & the Govt bringing policies in that make it impossible to stay in their home cause of new Govt Anti-Landlord (Which end up being anti-tenant) policies.
And my other point is, if the Government & authorities KEEP CHANGING the rules, goalposts in their idiotic wisdom thinking they making it better for tenants, they ARE NOT! Come see what's happening on ground level.
And yes, your words:
The cases where the tenant does pay the rent, eventually, but it is always late, refuses to give the landlord access and fails to communicate regularly, leaving the landlord with no choice but to pay the mortgage out of his own pocket until the tenant coughs up?
I have many of them, not yet evicted cause of them reasons, but as one gets older, one cannot bear much more of the late payers & the same ones every year who just won't play ball with the Boiler service man WHO IS TRYING TO SAVE THEIR LIFE!
And Yes Monty, many Landlords when asked by the Council Homeless Dept, Why u evicting, if Landlords says cause of rent arrears, Landlord says No as he knows the Council won't help them. I've said this for many years just cause I need tenant gone & new tenant in to pay mortgage quick.

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