Letting commentators have identified a potential ‘loophole’ in the Renters (Reform) Bill which will create a patchwork system whereby some landlords will be able to continue serving Section 21 notices and others won’t.
Goodlord’s Managing Director of Insurance, Oli Sherlock, and Solicitor at Dutton Gregory Solicitors, Ryan Heaven, say they have identified a critical detail that will have an impact on some tenancies after careful analysis of the current Renters (Reform) Bill.
According to Sherlock and Heaven, and discussed in a recent webinar, despite a pledge from the housing secretary that Section 21 will have been banned by the time the country goes to the polls in a General Election, it seems highly unlikely that this will prove to be the case.
“A lot of people place emphasis on Michael Gove stating that section 21 would be ‘outlawed’ before the election, but when you examine the Bill closer this is not what will happen; whenever the election date is there will be some landlords in this country who will still be able to serve a section 21 notice even if it others are not able to.” Heaven said.
Instead, the Bill passing into law will usher in a new phase where three broad tenancy types exist, one of which will still allow for the enforcement of Section 21:
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A new tenancy created after the Bill has been implemented
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That means you can’t serve a Section 21 notice.
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Any fixed-term tenancy that becomes periodic once the Bill has been implemented
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Landlords would still be able to serve a Section 21 notice until the tenancy switches over to a periodic one. However, once that happens, the new rules apply and you can’t serve a section 21.
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Tenancies that are periodic when the Bill is implemented
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For these tenancies, landlords will still be able to serve a Section 21 until the Government reviews the Court system, reports on it to parliament, and then sets an ‘extended implementation date’ at which date the new rules all apply to all tenancies.
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As such, tenancies which fall into this category could be served a Section 21 notice after the election.
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Sherlock commented: “As the Bill currently stands, it seems that the apparent promise to delay the scrapping of Section 21 to allow for court reform is not what it seems. Instead, it appears that the market will be delivered a fragmented process which sees some tenancies permitting Section 21, some not, and others that could fall into either camp depending on how a tenancy renewal is handled.
“This would all be taking place alongside an investigation into the courts, which currently has no confirmed timeline or identifiable metrics for success. The deep irony here is that the very same courts will be managing more and more cases deriving from tenancies where section 21 has already been outlawed. Arguably this is the worst outcome for all parties.”
Sounds like complete ineptitude with a sprinkling of sabotage to me
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I agree, we see nothing changes with the proposed implementation of new legislation by government!
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I can’t understand why they don’t just change Section 21 from 2 months to 6 months, as already in place in Wales under the Renting Homes (Wales) Act 2016. Landlords generally want stable, long term tenants, but if they need possession for any reason this gives tenant ample time to find a new home. It is also a good way of getting rid of a troublesome tenant without the need to go to court, which then makes it more difficult for the tenant to find a new home in the future.
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I think 6 months is a bit long but agree 2 months isn’t long enough for people to find in the current market. Maybe 4 months would make it easier for people to find an alternative place to rent. It would take the pressure off existing tenants at the point a Section 21 was issued and relieve the urgency of having to find an alternative place to rent and some of the pressure/fears of being left homeless which I am sure makes it a very negative experience for the person having to find somewhere else to rent. I also firmly believe if the government got their act together and you could issue a Section 8 within 8-10 weeks and have a bailiff if needs be within this time frame to get a troublesome tenant out then the use of Section 21 would drop dramatically. They are being used now because they are so much faster and cheaper than going to court.
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