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Was section 21 such a bad thing?

This article originally featured in 24 Housing

The writing has been on the wall for the so-called ‘no fault’ eviction process for some time.

But despite the apparent inevitability of its the demise, the decision has still prompted a strong reaction from both landlords and tenants.

As a specialist housing lawyer, I serve section 21 notices for landlords – both private and social housing (whose use of section 21 appears to have been ignored in the current debate but who will also be affected by its repeal) – and then issue possession proceedings based upon those notices on a nearly-daily basis.

Overall, I am concerned both for many of my landlord clients and tenants, that the true impact of the proposals may have been hidden under the headline-grabbing, more positive aspects.

I would emphasise that my concerns about the section 21 repeal do not mean that I cannot appreciate the argument tenant groups have relied upon to support their call for change.

At the time section 21 was introduced in January 1989, just over 9% of households were in the private rented sector (PRS).

PRS is now the second biggest group of households; at 19.5% it is now bigger than the social housing sector – and, with home ownership and social housing developments continuing to shrink, it is continuing to grow.

With the increase in families and older tenants moving into the PRS, the desire to give this new demographic a greater chance to put down roots and bring them stability is entirely understandable.

However, I think that achieving this outcome will come at a price for the sector.

Having read the consultation document last year, various subsequent response documents from respected groups, and media reports, I have seen the phrase ‘no fault’ eviction being used time and again to describe the act of seeking possession based on a section 21 notice.

This label is, in the vast majority of cases, a complete misnomer.

There are cases where a tenant can be asked to leave their home for ‘no fault’ of their own – typically where a landlord wants to sell with vacant possession, or perhaps following the death of the landlord, where the deceased’s family have no desire to take it over.

But the picture the label paints is to suggest that landlords are akin to Roman emperors in the colosseum, arbitrarily deciding to end a tenancy with the turn of a thumb.

Any sensible landlord will only seek possession in cases where a tenancy has not gone smoothly, where there is ‘fault’; where there are rent arrears, or a persistent delay in paying those arrears or where there are concerns about behaviour that is taking place within a property.

Landlords do not want to go through the time, stress and cost of finding new tenants for a property and evicting existing tenants without a good reason.

Many private landlords are not operating on a large scale, they may own just one or two properties.

Section 21 has provided those landlords with an ability to obtain possession relatively simply, without having to become embroiled in evidential arguments before the Court, without much of the animosity that having to attach a ‘fault’ label will bring.

A fact that also appears to have been overlooked in the debate is that section 21 is not all bad news for tenants.

The lack of any ‘fault’ being attached to the tenant has made it easier for them to find new accommodation – both in the private sector and from local authorities.

In many cases, section 21 has led to tenants avoiding having a county court judgment attached to their name.

Many of our landlord clients currently write off many thousands of pounds of rent arrears and instead focus on issuing accelerated possession proceedings following service of a section 21 notice.

There will be an increase of tenants facing monetary claims when possession has to be sought pursuant to a proposed section 8 ‘fault’ notice.

The finding of fault is also likely to make it harder for tenants to seek housing from the local authority.

So, what is this lawyer’s view?

The disappearance of Section 21 will change the make-up of the sector.

There has already been an increase in larger PRS investors, and they will continue to grow.

The sector will become more professional, landlords will have to operate in a more business-like manner.

The professionalisation of the sector is heralded by tenant groups, and I can understand this view.

But it will come at a cost.

The weight of legislative change that has affected private landlords over the last few years has already caused many to question whether they wish to remain in the sector; there is no doubt that the government’s announcement will be the final straw that will see many smaller landlords sell-up and leave.

Undoubtedly, in some areas of the country – areas where it may be harder to attract the larger PRS landlords- this will lead to tenants finding difficulties in finding rented homes.

Aside from the detail of the proposals, my biggest concern is the publicity that the government announcement has brought seems to tar all landlords with the same brush.

This is unfair.

The landlords I come into contact with, both as clients and at events, are good landlords.

Some have tenancies where rent has not been increased for years.

They have nice homes to offer to their tenants.

They have happy tenants.

Those landlords do all they can to avoid evicting a tenant and are genuinely upset when they have no choice other than to pursue the possession route.

Undoubtedly, there is a rogue element within the sector, and it is absolutely right that they should be stopped; but there is a raft of legislation already in place which, if properly operated, would tackle the landlords within the sector who offer poor quality housing and who have poor management skills.

My fear is that the landlords who flout the law now will continue to operate outside of the law going forward.

The beds in sheds landlord in unlikely to go through the niceties of a section 8 Court process if he wants to regain possession.

Much as I would like to think there could be a rethink, I do not believe the government will alter their course on this issue.

Section 21 will be no more within a year or so.

The focus now for all concerned will have to be in ensuring the implementation of the reforms is carried out in a way that will not do more harm than good in the long term.

For more information please contact Joanne Young a Legal Director from our Property Litigation team on j.young@ashfords.co.uk

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