NRLA open letter answering unbalanced Shelter press release

NRLA open letter answering unbalanced Shelter press release

15:49 PM, 3rd May 2022, About 3 weeks ago 21

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The NRLA has sent an open letter to the Chief Executive of Shelter, Polly Neate CBE, looking to redress the imbalance of the latest Shelter press release:

Dear Polly,

I write following the publication of Shelter’s research: “Every seven minutes a private renter is served a no-fault eviction notice despite a government promise to scrap them three years ago.”

As you know, there are many issues around homelessness and the private rented sector on which Shelter and the NRLA can agree. However, this publication presented a disappointingly one-sided picture, which has the potential to create needless anxiety for tenants that their landlord is about to evict them for no reason.

In fact, official data shows that it is only in a small minority of cases where tenancies are ended by either a landlord or letting agent. The most recently available English Housing Survey data on the issue, from 2019/20, shows that amongst those private renters whose tenancy ended over the previous year, 91.9% were ended by the tenant themselves rather than by being asked to leave by their landlord or letting agent.

This all demonstrates that, as we hear from our members, far from looking for ways to evict tenants, the vast majority of landlords much prefer to sustain tenancies and keep tenants in their homes.

  • There are, as we know, a small number of irresponsible landlords who have no place in the market and bring the wider sector into disrepute. Your press release, however, gives the misleading impression that most landlords fall into this category which is far from the case. For example:
  • A private renter being served a Section 21 notice every 7 minutes would amount to around 75,000 over the course of a year, representing just 0.7% of the 11 million private renters Shelter itself says live in England.
  • Regrettably, the press release failed to point out that the number of possession cases brought to court following a Section 21 notice being issued is actually falling. According to the Ministry of Justice, between 2019 and 2021 the number of Section 21 possession claims brought to
    court fell by 56%, from 19,042 in 2019 to 8,402 in 2021. This fall was not simply because of the repossession ban implemented during the pandemic. The number had already reduced by 50% from 2015 to 2019.
  • As you know, but did not make clear, many landlords using a Section 21 route to repossess a property do not do so because they have no reason to seek repossession, but because the alternative Section 8 route is not working as it should. For example: – At present, the Section 8 ground for anti-social behaviour is all but impossible to use properly. Where neighbours and fellow tenants are suffering as a result of such behaviour, as things stand now Section 21 is the only viable option to take swift action against people causing problems. – Ministry of Justice data shows that using a Section 8 notice can take a landlord almost a year between an application to repossess and obtaining possession. When landlords have a legitimate reason to repossess a property, this is simply too long, particularly as rent arrears can be building throughout this time for landlords who may be hard-pressed for money themselves.

Shelter’s press release also failed to explain the restrictions that are currently placed on the ability of landlords to issue a Section 21 notice. As you know, Section 21 notices are invalid in
the following circumstances:
– If a landlord has failed to protect a tenant’s deposit in an approved scheme.
– If a landlord has failed to obtain a licence for a property as is legally required.
– The landlord has not issued the tenant with a How to Rent booklet.
– The landlord has not issued the tenant with an Energy Performance Certificate.
– The landlord has not maintained the gas safety record for the property since the tenancy began.
– The landlord has not used the required Form (6A) to issue the notice.

In addition:
– Measures in the Deregulation Act 2015 protect tenants from eviction when they raise a
complaint about the condition of their home.
– Tenants can also challenge in a tribunal any rent increase they deem to be unfair, which
provides protection against excessive rent increases being used as a way of forcing tenants
out of a property.

The NRLA is not opposing the Government’s decision to end Section 21 and has been at the forefront of discussing and proposing a viable alternative. The private rented sector has increased significantly in the past ten years and is being asked to house people for whom the PRS was never intended. However, as our proposals for a new system make clear4, Section 21 cannot simply be scrapped without the associated reforms needed to ensure that a new system is fair and workable for both tenants and landlords. This has got to include clear and comprehensive grounds whereby landlords can repossess their properties with a legitimate reason – as most landlords do at present.

I know and welcome that Shelter agrees with this, as noted in the comments made to the Public Accounts Committee earlier this year5 by Policy Manager, Ruth Ehrlich, who stated that Shelter, “completely understand and recognise that, with scrapping section 21, there will need to be reforms to section 8.” She went on to note that removing Section 21 would mean, “the grounds for possession will need to be expanded.”

In a post Section 21 environment there will be a need to address situations in which tenants have built disproportionate rent arrears. NRLA also wants to ensure that support is in place to prevent rent arrears in the first place. This must include unfreezing the Local Housing Allowance, making enhancements to the broken Universal Credit system and doing more to boost the supply of all types of housing including those for private rent. However, where tenancies fail there has to be a sensible way for landlords to regain possession of their properties.

Speaking to the Public Accounts Committee Ruth Ehrlich also noted: “We would not want to see any changes to a mandatory rent arrears ground.” We assume from this that Shelter has appropriately distanced itself from suggestions that rent arrears should only be a discretionary ground to repossess a property. This would send a dangerous message that somehow paying rent should
be optional, which would not be acceptable in any other walk of life.

I hope this letter sets out clearly why NRLA has found your publication to be such an unbalanced account of what is happening now, and what needs to happen if Section 21 is to be abolished.

Rather than sensationalising the issue, we would welcome discussion about how you would propose tackling these important matters, particularly the problem of anti-social behaviour perpetrated by tenants. Simply continually calling for the abolition of section 21 without any discussion of the delicate issues associated with its removal, as articulated here, does nothing to advance the debate.

Given the interest in this matter, and in order to provide much needed balance to the report, we will be making this letter publicly available. I look forward to hearing from you.

Yours sincerely,

Ben Beadle
Chief Executive



Comments

by Rob Crawford

23:20 PM, 3rd May 2022, About 3 weeks ago

A good letter from NRLA covering our concerns. However, I wonder what NRLA's next step will be as I suspect their requested meeting with Shelter will be rejected! I am also concerned that the abolition of section 21 may happen to achieve votes, before section 8 has been reformed. So let's not wait too long for a response from Shelter before making the Government aware of the issues raised and imbalance of Shelter's views.

by peter-sharples@outlook.com

10:33 AM, 4th May 2022, About 3 weeks ago

If, or should I say , once S21 is changed, how many landlords will sell up, at 63, having been a Landlord for 20+ years, I will be selling up. The number of houses I have will cause even more pressure on renters.

by Seething Landlord

10:37 AM, 4th May 2022, About 3 weeks ago

Reply to the comment left by Rob Crawford at 03/05/2022 - 23:20
I should be surprised if NRLA have not already copied the letter to government.

by DSR

10:40 AM, 4th May 2022, About 3 weeks ago

closing the barn door after the horse has bolted!

NRLA should be up there and on it before Shelter can even publish propaganda like this. Shelter only 'gets away' with pumping this stuff in the media as they know the 'opposition' has no balls.
If the NRLA got a bit more militant and used the tactics against Shelter that they deploy, then they would be seen as a bit more of a dog with a bite.

I see NO PROACTIVE media campaigns showing the LL side? Its ok to shout after Shelter put out this tripe but its too late - soundbite over, move on. Damage is done and the PRS again attacked....

by Rob Crawford

10:42 AM, 4th May 2022, About 3 weeks ago

Reply to the comment left by peter-sharples@outlook.com at 04/05/2022 - 10:33
You may need to plan this before section 21 is scrapped or you'll be stuck with tenants!

by BobG

10:44 AM, 4th May 2022, About 3 weeks ago

Excellent letter - I agree with what others have said.
I also think it is the Government who need to be persuaded as Shelter has never accepted our point of view.

by moneymanager

10:48 AM, 4th May 2022, About 3 weeks ago

It might be an "open letter", but will it obtain the same level of exposure, news of a fire is always more avidly read than its being extinguished?z

by Dylan Morris

10:53 AM, 4th May 2022, About 3 weeks ago

In a normal healthy rental market there wouldn’t be any issue at all with ending a tenancy with a Section 21. There never used to be. The tenant would simply find another property to rent and move.
Of course we’re not in a healthy market at all now. Massive shortage of rental properties caused by continued mass legal and illegal immigration. Clause 24. And daily anti landlord rhetoric, ineffective Court system and more future regulation and bashing such as EPC C min standard along with other general worries and fear for the future for being a landlord, leading to landlords selling up.

by dismayed landlord

13:20 PM, 4th May 2022, About 3 weeks ago

Just for information I have been i the last week asked by 2 tenants with children who are overcrowded to serve them section 21notices in their belief that by doing so will give them more ‘points’ and thus acquire them larger LA supported accommodation . I am going to oblige simple because if I do not they will only stop paying anyway. . One has had re arrears since the start of the pandemic but has promised to continue paying current rent if I serve S21.
This may or may not work out but as I want to sell all my remaining portfolio I am going to bite the bullet.

by Borrieboy

14:39 PM, 4th May 2022, About 3 weeks ago

With returns of ~5% assuming no void periods or serious renovations at tenancy ends, added to which there’s a relentless stream of one-sided anti LL legislation, licensing etc. why would anyone in their right mind bother entering the PRS? Even any likely gain in property value will be subject to CGT too. The PRS worked well up to around 5 yrs ago but I for one (in fact probably many) will be selling up within the next year or two… CGT or not, the whole gig’s become untenable.

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