Scrapping Section 21 evictions is a ‘worry’ for agents and landlords

The government has finally committed to reform how landlords evict tenants, including the abolition of possessions enabled under Section 21 of the 1988 Housing Act, and this is a major concern for many letting agents and buy-to-let landlords, with many now considering fleeing the market.

Various studies show that a number of buy-to-let landlords are considering divesting their portfolios and leaving the PRS due to an increase in regulation and rules.

One of the most significant surveys carried this year was by Assist Inventories, which questioned more than 10,000 letting agents and landlords to gather data for their Sectors Snapshot report.

The study, undertaken in early 2022, found that 73% of agents believe that the abolition of Section 21 will cause an exodus of landlords.

The research also revealed that 75% of landlords are likely to now become more selective when choosing tenants, while 45% of landlords plan to just offer short-term lets only.

Some 90% of landlords and 70% of lettings agents want clear and comprehensive grounds outlined for possession when required, with 60% of lettings agents believing that further reforms of Section 8 is required.

More than half – 58% – of landlords think that more financial support is required for tenants in risk of rent arrears, while 48% of landlords believe that the abolition of Section 21 will balance rights with 33% of agents agreeing.

Raj Dosanjh, founder of Rentround, commented: “The abolishment of Section 21 is clearly a worry area for agents and landlords, with many disagreeing with the move.

“Due to the additional risk the abolishment will bring to landlords, it’s obvious that many will move to shorter tenancies and more stringent tenant background checks.

“This will make it harder for tenants with blemishes on their record, or those looking to get long-term residencies to rent in the future.”

 

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6 Comments

  1. Will2

    My guess is that Mrs May’s decision to abolish S21 later supported by the very suspect Boris Johnson under the request of Shelter will prove to be the most damaging of all policies on the rental market in recent years. Taking us back to the legendly killing of the PRS in 1977 with the Rent Act, which stopped letting in its track.  The ongoing LANDLORD BASHING politicians and so called charities will damage the interest of those most needing lower rents and more flexible rentals. This ongoing landlord bashing has made the rental housing market toxic as an investment. Yes I have no doubt there are some bad landlords but like everything the vast majority of decent landlords are adversely affected with higher costs passed on to tenants. Bad and bullying councils have further reinforced the toxic feel with actions like claw back and inciting tenants to become in contempt of court by instructing them to ignore initial court orders and wait for bailiffs (purely to punish landlords) contrary to Government guidelines. I predict many, have and many more, landlords will flee the market. Those brave enough to stay will wise up on how to best protect their investments, much tougher referencing and restrictions will emerge. The poorest will suffer the most as the pool of prospective tenants gets larger the best fish will be housed the others will merely increase the demand for cardboard boxes and street living. Those bullying politicians and councils will have less housing supply and increase demand they will be unable to fulfil. Landlords and ex-landlords will be able to say you idiots we told you so!

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    1. AcornsRNuts

      Well said.  For some reason  cannot give you a thumbs up.

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  2. Tinylettingagent

    Yesterday alone we had 2 calls from landlords expressing concern about the impending changes.  One that stuck out was from a landlord who owns 4 properties, all rented between well below the market rate and the average tenant having been with him for 10+ years.

    His main concern was not being able to get his properties back for his grandchildren to live in, so much so that he is contemplating selling them all up early so he doesn’t get stung.

    I spent an hour chatting to him and potentially have put his mind at ease, but this ‘one-sided’ law change will no doubt push a lot of decent landlords out of the market completely.

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  3. Russell121

    What I’m finding is that its the landlords with the larger family homes who are getting out of the market, the exact same properties that are already in short supply.

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  4. Shazza

    Sadly  I have already put 4 of my family’s on 5 months notice they have been with me.for 12 -15 years, but all the new regulations along with not actually having control over your own property any more has made the decision for me, I am going to sell all my properties. Its a sad life when you have tenants that are good and respect the accommodation for so long then are asked to leave because some bored person wants to make new regulations making decent Landlords suffer. I still have many more to put on notice and the availability choice is getting less for them.

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  5. Real Estate Investor & Landlord

    Not saying these changes are great, but just be grateful you’re not a landlord in the Netherlands or Germany. In the Netherlands, a so-called ‘tolerant’ country, only a judge can terminate a rental agreement, and they refuse to terminate one to grant vacant possession if the landlord wants to sell. So landlords in the Netherlands have to sell with the sitting tenant, or pay the tenant a huge bribe to leave. Hardly tolerant, is it? Germany is the same, a country that doesn’t allow landlords to terminate a lease to sell with vacant possession. This type of prohibition is an astounding violation of the landlord’s property rights, and the EU should be intervening to stop this. There are no human rights without property rights. Just as well the UK has not followed this vindictive policy, and not even the far left in the UK would contemplate introducing it. Worthwhile comparing how you’d be treated elsewhere to gain perspective.

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