Urgent need to review Section 8

by Property 118

8:34 AM, 14th November 2018
About a month ago

Urgent need to review Section 8

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Urgent need to review Section 8

The National Landlords Association (NLA) is calling for the Government to review the section 8 possession process.

The section 8 possession process requires landlords to seek a court order to gain possession of their property where the tenant has breached the terms of their tenancy agreement. However, tenants can challenge the possession claim and remain in the property.

For the successful possession claims, there is an average period of 18 weeks between claims and repossessions¹, which can cost up to £355 per claim² in court fees alone. The landlord also has to cover legal costs and may face losses when tenants are in arrears and stop paying rent. The NLA’s latest survey of landlords shows that it can take an average of 145 days to regain possession of a property at a cost of £5,730³.

Rent arrears is the most common reason for a landlord to file a section 8 possession claim. Our landlords panel found that 36 percent of landlords experienced rent arrears and 15 percent have sought to regain possession in the last year³.

The alternative to section 8 is section 21, where no reason is needed and gives tenants two months’ notice. However, this can only be used after a fixed-term tenancy ends or during a periodic tenancy. Landlords often serve both notices simultaneously as it provides greater certainty of vacant possession. This can be vital when a landlord needs to sell the property or move in themselves.

Richard Lambert, CEO of the NLA, says:

“As it stands, the system is failing and needs urgent reform. Landlords are forced to rely on section 21 ‘no fault’ notices, even when there is a breach in tenancy. This is essentially a sticking plaster covering the fundamental issue – that the section 8 process is no longer fit for purpose.

“While the majority of tenancies are ended by the tenant, landlords need to be confident they can regain possession of their properties efficiently in the event of a breach of tenancy to effectively manage their business risk.”

¹ Ministry of Justice Mortgage and Landlord Possession Statistics in England and Wales, April to June 2018

² Ministry of Justice Civil and Family Court Fees (from February 2018)

³ NLA Landlord Panel Survey Q3 2018 (690 respondents)



Comments

Luke P

13:07 PM, 14th November 2018
About a month ago

There is another omission from S.8...there are no grounds for possession for 'sale of the property'. One may advise using a S.21, but I have a client who has had that option removed due to a technicality. This means, despite having left the country and wanting to sell, they are forced to remain a landlord until the tenant decides to either leave of their own accord or breaks the terms of the agreement to the extent that it applies to one of the (existing) S.8 grounds...

Annie Landlord

14:12 PM, 14th November 2018
About a month ago

That's worrying Luke! Be interested to know what the technicality was? Deposit not protected/PI not served, or something else?

Luke P

14:37 PM, 14th November 2018
About a month ago

Reply to the comment left by Annie Landlord at 14/11/2018 - 14:12
No mains gas (oil-fired central heating), so no GSC. Log burners in kitchen and snug, but lounge has an imitation log burner that runs on gas (bottles connected up immediately outside the exterior lounge wall). Not working so capped off and no gas bottles provided. Tenant, in an attempt to stall for time (had an application on a new property pending, which ultimately fell through) filed a Defence. Judge agreed to Hear. Judge unable to comprehend that if a tenant chooses to uncap burner (which he didn't actually do, just suggested he could/would/might...reality was he didn't know it had been capped off and was going to try to use it anyway) and provided his *own* gas bottles then the LL cannot possibly know this and arrange for/provide a GSC (no different from the tenant of a remote property with no mains gas calling the main supplier to dig in a pipe...the LL would never know as they'd rented a house without the supply of gas). Option to remove burner wasn't simple as it was fairly integral to the main feature fireplace. As per Caridon Property Ltd v Monty Shooltz, no GSC *before* tenancy begins = no S.21...EVER. This leaves a bit of a legal blackhole, meaning only option for recovery would be S.8 and as I explained, there are no grounds for sale of property. Use by LL as main residence (if previously used as main residence) is an option, but the LL is already abroad and wouldn't want to go through all that. This is why in Scotland, upon removal of S.21, separate provision for recovery due to sale was created. Caridon v Shooltz has had an unintended consequence, I believe.

This could also happen to someone who had a GSC completed the same day as the tenant signs (not uncommon across a portfolio of several hundred properties, where an expired GSC on an empty/advertised unit is held off from renewal until a tenant is secured, otherwise you're wasting lost months). Of course we now advise a GSC is completed at least a full day before a tenant signs, but you cannot change the past.

AJ

16:40 PM, 14th November 2018
About a month ago

Thats interesting, I have a tenant in a house where there is no gas supply, I would of thought that Transco would not be able to put one in without my permission. Which means if the tenant wanted they could have a gas supply fitted and then not move out because I have not issued a gas safety cert.

Luke P

17:01 PM, 14th November 2018
About a month ago

Reply to the comment left by AJ at 14/11/2018 - 16:40
Hopefully you won't get a useless Judge.

Annie Landlord

8:39 AM, 15th November 2018
About a month ago

But that means that a landlord could be stuck with a property forever, due to what could be a one off oversight, or in Luke's case a convoluted set of circumstances. So if S21 goes (I'm assuming it won't go altogether, rather be amended like Scotland) S8 would need to include landlord wishing to sell?

Luke P

9:14 AM, 15th November 2018
About a month ago

Reply to the comment left by Annie Landlord at 15/11/2018 - 08:39
To be honest, in light of the above case and S.21s increasingly being rejected on technicalities, when it comes to selling the property at least, I think we already need a wholly separate section of the legislation to allow this…one where mere technicalities do not exist. Perhaps contracts are exchanged eight weeks before completion in the case of a tenanted property and the tenant must be gone at week six. Failure to do so means the Bailiffs will prioritise the eviction within the final two weeks before completion. No ifs or buts (and it ensures the sale is genuine).

Chris Daniel

9:52 AM, 15th November 2018
About a month ago

Reply to the comment left by Luke P at 14/11/2018 - 14:37
Where Tenancy P.I docs are served the same day as the tenancy - best advice is to have a witness and Date AND 'TIME' the signatures for receipt of the P.I docs
( showing they were 'served before the tenancy began' )

Dylan Morris

12:02 PM, 15th November 2018
About a month ago

Is there any process where this judgement can be appealed ?

Luke P

12:15 PM, 15th November 2018
About a month ago

Reply to the comment left by Chris Daniel at 15/11/2018 - 09:52
We’ve been doing times on tenancies and other paperwork since the days when Notice was served at the beginning of a tenancy. One tenant claimed they signed the Notice first, *before* the actual agreement making the Notice meaningless. The Judge believed them, so on went a space for times as well as dates!

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