Landlords tighten tenant selection after scrapping Section 21 – COHO

A management platform has warned that the abolition of Section 21 has made landlords more selective in choosing tenants, following a rise in eviction notices ahead of the Renters’ Rights Act coming into force.

Research by COHO claims the act led to an estimated 73,900 additional eviction notices being issued since 2023, with nearly 20,000 served in the final month before the legislation took effect on 1 May.

The platform claims, without Section 21 evictions, landlords are now more cautious about taking on tenants they perceive as higher risk.

Section 21 gave landlords a safety net

Vann Vogstad, CEO and co-founder of COHO, said: “Landlords aren’t looking for perfect tenants, they’re looking for tenants who can pay the rent and live without causing issues. In most cases, they’ll give people the benefit of the doubt for quite some time.

“Section 21 gave landlords a safety net. It allowed them to stick with tenants through arrears or challenges, knowing there was a final route if things didn’t improve. Removing that option has understandably changed behaviours.

“What we’re seeing isn’t landlords evicting for the sake of evicting; it’s landlords responding to a shift in risk. Without Section 21, dealing with serious arrears or anti-social issues can take months, so some have had to act ahead of that change.”

He adds: “It’s important to remember that landlords don’t want empty properties. Rental income is what makes the investment viable. Many are still choosing to work with tenants that owe them rent, hoping situations improve, rather than issuing notice.

“Ultimately, the removal of no-fault evictions will likely make landlords more cautious and selective, which may have wider impacts across the rental market.”

Section 21 eviction levels increase

According to the research, Section 21-related evictions stood at 5.7% prior to the Act’s passage.

Following initial news of the Renters’ Rights Act, the rate rose to above 8%, before stabilising. Post-election momentum then saw Section 21 eviction levels increase to 11.4%.

After Royal Assent, Section 21 notices climbed again to 11.2%, before peaking at 27.1% as the legislation came into force in May this year.