ARLA response to Section 21 ban proposals

by Property 118

6:19 AM, 15th April 2019
About 2 months ago

ARLA response to Section 21 ban proposals

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ARLA response to Section 21 ban proposals

Today, the Government announced its intention to abolish Section 21 notices for eviction, in an effort to create open ended tenancies for all private renters. Section 8 evictions are also set to be reformed, with a consultation launching shortly.

Tenants are rarely evicted via Section 21 notices unless their landlord has a genuine reason for needing their property back, such as selling or needing to undertake major works.

David Cox, Chief Executive, ARLA Propertymark responded to the news: “Today’s news could be devastating for the private rented sector and landlords operating within it. The effects of the tenant fees ban have not yet been felt, and now the Government is introducing more new legislation which could deter landlords from operating in the market. Although in the majority of cases there is no need for Section 21 to be used, there are times when a landlord has no choice but to take action and evict tenants from a property. Until we have greater clarity on the changes planned for Section 8, today’s news will only increase pressure on the sector and discourage new landlords from investing in buy-to-let properties. This comes at a time when demand is dramatically outpacing supply and rent costs are rising.”

ARLA Propertymark will be engaging with the Government to ensure they fully understand the consequences of any changes, and all changes are based on evidence, so landlords have the ability to regain their properties if needed.



Comments

PJB

8:15 AM, 16th April 2019
About 2 months ago

One of many problems will be that of University students that decide to continue living in an HMO under statutory periodic rules. In the meantime, the next set of students that have signed up to legally occupy the property can no longer do so. I believe that in such cases, it is still the landlord's responsibility to honour the AST agreement and find suitable accommodation for these displaced students.
Do far sighted landlords now club together to secure a pool of empty properties as insurance against such events?

Whiteskifreak Surrey

11:50 AM, 16th April 2019
About 2 months ago

Reply to the comment left by PJB at 16/04/2019 - 08:15
This is an extremely important problem, and I am not sure how that can be handled? Normally students confirm around January/February that they intend to either stay or vacate, and if they are not staying, then the student house is advertised for the next academic year. Are you saying that they can decide in the last moment that they want to stay, and the LL will be left with a lot to find the accommodation in the last minute (we rent now on AST to group of 4 students)?. Can we make their declaration of intent to leave somehow as a legal obligation?

JB

13:41 PM, 16th April 2019
About 2 months ago

The tenant fees ban and reduction in holding fees deposit will cause big problems for student lets. If prospective tenants bail out (with little cost to them) just before the new uni year starts it may not be possible to find new tenants for that academic year. Then you've got a 6 bedroom house empty for a year.

PJB

16:45 PM, 16th April 2019
About 2 months ago

Reply to the comment left by Whiteskifreak Surrey at 16/04/2019 - 11:50Yes, I am saying that without a Section 21 notice (or its future equivalent), there will be no legal obligation for the students to leave. If the LL has students lined up for the following year, this situation puts the potential incoming students, the letting agent and the Landlord in deep brown smelly stuff. The University itself could also get dragged in.
The nearest safest option that I can think of is a variation to the principles of holiday lets where a finite duration of tenancy is a good as guaranteed. Any comments anyone?

Luke P

17:23 PM, 16th April 2019
About 2 months ago

Reply to the comment left by PJB at 16/04/2019 - 16:45
Far-fetched, but what if one of the, say, six students actually wasn’t a student or a five student household with an empty sixth room found their own non-student lodger (without the LL’s knowledge) to help share the bills…what would their status be? Even if completely separate rules were created for students and/or S.21 remained solely for them, it couldn’t be applied to the sixth person…

PJB

18:10 PM, 16th April 2019
About 2 months ago

Reply to the comment left by Luke P at 16/04/2019 - 17:23
This is more an AST agreement issue rather than S.21. What you describe would potentially be problematical with a property let with 5/6 individual AST agreements; each would have to contain a no subletting clause. In this case, how do you find out which individual was responsible for subletting the sixth room?
We have always let our HMO properties using one AST agreement per property. The agreement specifically prohibits subletting. If we found that the sixth room had been sublet, we would be within our rights to evict the entire household using section 8. Our preference has been to name all the students a single AST agreement and any leavers or joiners would be handled via a 'deed of assignment'.
Currently, If the sixth person is not a student, the AST agreement doesn't care. However, he/she has an obligation to pay council tax. If S.21 is still permitted for student lets but not for non-students, there would be no legal difficulties with individual room let agreements - EXCEPT, when the student has defaulted to become a non-student having completed his/her final exams. There is still a difficulty with this potentially selective S.21 rule however, where students and non-students are bound by the same single AST agreement.


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