Government makes clear in new consultation that abolition of Section 21 will go ahead

The Government has published a consultation on its plans to abolish Section 21 – the process by which landlords or their agents can reclaim properties without having to state a reason.

There is no question that the abolition will not go ahead – it will be achieved by getting rid of Assured Shorthold Tenancies.

Landlords will in future need to give a “valid reason for taking back possession of the property and would need to be able to satisfy a judge of the validity of their claim”.

The consultation, slipped out shortly after midnight yesterday as the Theresa May premiership draws to an end but also when many people go on holiday, largely focuses on issues such as improving the court system and Section 8.

Called “A new deal for renting: resetting the balance of rights and responsibilities between landlords and tenants”, the consultation relates to England only and is open until October 12.

The abolition of Section 21 will be achieved by removing Assured Shorthold Tenancies from the Housing Act 1988: “Once we abolish Section 21, there is no longer any significant legal distinction between an assured shorthold tenancy and an assured tenancy,” says the consultation.

ARLA said yesterday that the impact on the private rented sector cannot be under-estimated.

The consultation states that tenancies would not have to be open-ended, with a choice between a fixed-term agreement and a period contract that rolls over. However, one of the questions asked in the consultation is whether fixed terms should have a minimum length.

The consultation says that the Government does not support rent controls, but raises concerns that landlords may try to force tenants to leave a property by increasing the rent at the end of the fixed-term period to an unaffordable level. Legislation would prevent this by banning clauses  allowing changes to the contract after the fixed term.

A number of questions are asked as to valid grounds to reclaim a property.

Among them are:

  • If the landlord or a family member wants to use the property as their own home – if so, should this be allowed within the first two  years of a tenancy?
  • If the landlord wants to sell the property.
  • Rent arrears – the Government is considering allowing a landlord to serve a two-week notice seeking possession once there are two months of rent arrears. This would be a mandatory ground. If the arrears are under one month, then the ground would be discretionary. Critics say the consultation does not address the question of persistent rent arrears.
  • Anti-social behaviour – could tenancy agreements be strengthened to make it easier to provide evidence in court?
  • Domestic abuse could be a new ground, and could allow the landlord to evict the tenant who has perpetrated the abuse, not the whole household. The consultation also asks about protecting the victim should the abusive partner threaten to terminate a tenancy.
  • Unsafe properties: if a tenant has allowed the property to deteriorate below legal standards, should this be a ground for possession?

The consultation also asks questions about student accommodation and short lets, and whether and how these sectors should be included in the new framework.

The changes proposed would not be retrospective – Section 21 could still be used to end existing ASTs after the legislation comes into force. The new law would probably be implemented six months after Royal Assent.

ARLA Propertymark yesterday said: “This is big news for the sector and we cannot under-estimate the impact.

“We cannot accept amendments to the Section 8 eviction process unless all grounds are mandatory and include persistent rent arrears and anti-social behaviour.

“Only after a full impact assessment and conclusions from a pilot should the Government abolish Section 21.”

Chris Norris, director of policy and practice at the National Landlords Association, said: “The court system has been in dire need of reform for a long time, so we’re happy to see action on this.

“Any improvements to this system need to be in place, properly funded and fully functional before the Government even contemplates changes to Section 21.

“Landlords have been relying on Section 21 to compensate for the many failings of the Section 8 fault-based process, which has become too costly and time-consuming.

“If the Government want to deliver a fairer, better quality and more affordable private rental market, as they claim, they should try listening to the concerns of landlords, not just court the voting renters.”

David Smith, policy director of the Residential Landlords Association, said: “Landlords’ concerns over scrapping Section 21 remain unchanged unless and until a new system is in place that provides the confidence and certainty needed that they can regain possession of their property in legitimate circumstances.”

Smith writes in today’s EYE about why so many landlords and agents believe Section 21 should be retained.

The consultation is here:

https://www.gov.uk/government/consultations/a-new-deal-for-renting-resetting-the-balance-of-rights-and-responsibilities-between-landlords-and-tenants

The Government has also launched a consultation to allow tenants and potential tenants to view the database of bad landlords and agents.

Currently, the database can only be viewed by government at local and central levels.

The consultation does not suggest that landlords and agents should also have access to the database to check each other out, or that agents looking to hire staff should access it. Nor does it suggest that membership bodies such as ARLA should be able to view it.

However it does ask who else, apart from tenants, might benefit from access.

The consultation also suggests new offences which would mean an agent or landlord could be included on the blacklist.

David Cox, ARLA chief executive, said: “We have long argued for the database to be publicly available.

“We do however still believe legislation should be combined with the 1979 Estate Agents Act, as without combining the lists, there is a real danger that a banned sales agent could set up as a letting agent or vice versa which will do little to improve the standards or perception of the industry.”

The answer to a Freedom of Information request three months ago revealed that there were just four names on the blacklist.

The consultation on the blacklist is here:

https://www.gov.uk/government/consultations/rogue-landlord-database-reform

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17 Comments

  1. JamesB

    usual useless consultation – decision already made.  Seen a a big generation rent vote winner so it’s a done deal

    unbelievable when true no fault evictions represent under 2% of tenancies in the U.K. ending, versus the damage it will cause.

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    1. Will2

      They may be trying to win generation Rant votes most of whom would not convert to the cons because these people are inherently left wing/commies but they will be losing landlord votes – ie traditionally their own supporters.  None of this was part of Mrs May’s manifesto. Mind you she seems incapable of reading the mood out their which is why she is going!  Not being able to vote conservative, labout or lib dem does not leave a lot of choice!

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      1. The_Maluka

        One could always vote Monster Raving Loony party – oh sorry forgot they are already in power.

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  2. jeremy1960

    More consultation to tick boxes whilst we all know that government will ensure that it’s swept under the carpet and they just carry on with their own agenda. Mrs May who has been the death knell for the prs leaves office this week,  will any replacement have the guts to see the real truth and reverse her catastrophic measures?

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  3. Steve Adams

    Can that really be right – “Legislation would prevent this by banning clauses  allowing changes to the contract after the fixed term.” ??!!!

    So once a fixed term comes to an end you can NEVER increase the rent ?!  They indicate they are not in favour of rent control but they want to prevent agents/landlords making massive hikes to the rent (which I agree with) to effectively force a tenant out because they will not be able to afford the rent.  But unless there is some form of control how would you ever be able to adjust rent in line with market increases ??!!!

    The answer might be that you implement a new fixed term agreement with the new level of rent.  But what if the tenant refuses to enter a new fixed term agreement and we have no power to bring the tenancy to an end if the tenant is complying with the contract but purely refusing to agree to a new agreement with a new rent ?!!  The only way to bring it to an end would be for the landlord to sell or move back in etc. ….

    That is a worry, a real worry 🙁

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    1. Will2

      But will they be able to move in or claim possession as a owner if they have been tempted over to putting the property in to a company name for taxes????  The Conservatives are a scandalous bunch of scaliwags.

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  4. LandlordsandLetting

    I want to know when the hell we are ever going to get a Conservative government back in power!

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  5. Tcos

    ARLA says it cannot accept the amendments but what are they actually going to do about it? The decision has been made and with recent evidence the government are not going to listen to what we have to say about it at all.

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  6. DASH94

    It’s ridiculous – this whole ‘no fault’ thing.    There is no such thing – I’ve never had a landlord request a section 21 notice be served because he wants to increase the rent!  No-one would evict a  good rent paying tenant – have a property stand empty for a while and then pay the new tenant find fee just to get an above average rent hike through!   Nor would you evict a tenant from a property with maintenance issues as a punishment unless you’re anticipating making the necessary repairs in order to get a new tenant in!  The key words in that sentence are ‘good’ and ‘rent paying’.

    Also – Domestic Violence being a new ground?  Are we now expected to get involved in those sort of issues along with all the other unrelated stuff we’re covering?    How on earth do you evict one  tenant?   Unless we’re expected to decide who the offender is – a court order would be required – which should be sufficient to have someone barred from a property anyway.  That’s not an issue we should be getting involved in surely?

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    1. Will2

      The difference here is that you are in the property profession not a moron in Government thinking you know best.

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  7. Will2

    So a rougue landlord list is going to be given public access.  How about  equality and Government not discriminating against landlords?  I have no problem with such a list but I do believe if Government in order to be fair  should also maintain a list of Rogue Tenants for public access.  Come on Brokenshire where is your level playing field you spout on about? An perhaps even a list of rogue councils who incite contempt of court by telling tenants they will have deemed themself homeless if they comply with possesion orders of the court; forcing landlords into greater expense of another application for a bailiff and paying bailiff costs so the lazy councils can put off the day of dealing with things for a few weeks.  Or why do the Government not change things so that debts by tenants on possession order are listed on the debtors list when you search county court judgements.  I think it is very clear (to use a politician words) that the Government are discriminating aginst landlords.

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  8. IHS

    If we going to have a database of Rogue Landlords then it is only fair there is a database of Rogue Tenants. Just had a couple leave dog excrement in the oven when they left because they objected to having the carpets cleaned even though it was a condition of them being allowed to keep two dogs in the property! They also claimed that the carpets should, by law, be replaced every four years – new one on me but anything’s possible nowadays!

    Still I suppose Generation Rent and Shelter would deem the above acceptable behaviour.

     

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    1. DASH94

      And these are the tenants that leave reviews on Google and Trustpilot.   GDPR protects the heck out of them – but they can come up with ideas like that with impunity.
      The oven thing – that’s a new on on me incidentally – I hope  it doesn’t catch on.  Takes a special sort of imagination to come up with that.

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  9. s71

    the sooner May goes the better, she is leaving behind a legacy of incompetence

     

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  10. adamcff

    For anyone who would like to look at the research behind section 21 evictions in the private rented sector, with helpful colourful charts!

    http://researchbriefings.files.parliament.uk/documents/CDP-2018-0258/CDP-2018-0258.pdf

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    1. PossessionFriendUK39

      Pity the Government didn’t look at it ( and its their chart ! )

      Lots written about Government incompetence and unfairness  in the PRS, on our facebook account,  @possessionfriend

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  11. Woodentop

    Try getting anti-social behaviour through the court!

     

    We’ve been conditioned to think that only politicians can solve our problems. But at some point, maybe we will wake-up and recognise that is is the politicians who created our problems. 
     

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