Viewpoint by Tom Entwistle
What at first glance may seem an innocuous change to the no-quibble eviction process afforded to landlords since the introduction in the 1988 Housing Act, the section 21 procedure, in my opinion has very serious and far reaching consequences for the future of the private rented sector (PRS).
A recent Government press release says:
“The government vow to work to outlaw so-called ‘revenge evictions’ that destroy a tenant’s right to expect to rent a safe and secure home.”
This follows a couple of rather spurious surveys and a Shelter petition to Communities Minister Stephen Williams and a private member’s Bill on the matter, due to be brought before the House in November by Sarah Teather MP.
The press release goes on to say:
“Ministers gave their backing in principle to a Private Member’s Bill to stop the small minority of rogue landlords who, rather than meet their legal duty to keep their properties at a reasonable standard and remove health and safety hazards, instead evict tenants simply for asking for essential repairs to be made – on the condition that the Bill only targets bad landlords and cannot be used by tenants to frustrate legitimate evictions.”
The way this is intended to work is:
“…extend the existing restrictions on a landlord’s power to evict, where they don’t protect a deposit or have a licence they are required to hold, to situations where a health and safety hazard has been identified by environmental health officers.”
My reaction to this is: do these ministers have any conception of the “can of worms” they will open up for the vast majority of good landlords with this seemingly innocuous change?
I came into the private rental market in the 1980s for one reason and one reason only: the introduction of the Assured Shorthold Tenancy (AST) and the guaranteed right through s21 to get a property back if all else fails. I consider myself a good landlord, always following the rules to the letter, and I’ve only had to use the s21 process on one or two times over many, many tenancies, and 30 plus years of letting, but the security afforded by s21 was always there.
During my youth I had witnessed a long decline into non-viability of my grandparents’ and parents’ residential property portfolio through rent controls and life-long security of tenure afforded by previous Landlord & Tenant Acts. There was absolutely no way I was going into a lettings business under such circumstances.
Fast forward 40 years and we see yet again a prospective Labour Government is threatening to bring back rent controls, compulsory long-term tenancies and restrictions on eviction.
And surprise, surprise, these Coalition ministers are happy to support a measure which will make it difficult if not impossible to remove a bad tenant.
The ministers say they don’t want to add, in their words “…unnecessary regulation that strangles industry in red tape and introducing laws dictating length of tenancies are a mistake which will make life unnecessarily difficult for landlords and investors.”
The above statements say to me than none of these ministers have any conception of how landlord and tenant relationships pan out in practice: even with the best will in the world, contentious matters such as repairs and health and safety issues, much like anti-social behaviour ones, are horrendously difficult and expensive to prove one way or another in a court of law.
It is pretty obvious to any experienced landlord what will happen. Ask some tenants to leave, for whatever reason – good landlords only ever do this as a last resort – and a repair / safety hazard will mysteriously appear, whether there was one there before or not.
These are the scenarios I envisage under the changes: for a start, Environmental Health Offices and the County Courts are both under resourced and overloaded with cases which will delay matters for weeks if not months. The existing system of “accelerated” possession through the county courts regularly takes 16 weeks or longer.
Faced with a tenant who is prepared to cause havoc in a property and cause purposeful damage to avoid paying rent, and add to this the highly contentious issues such as damp and condensation, problems with blocked access for the landlord to carry out genuine repair work, and arguments over what is allowable as wear and tear, and a good landlord has a nightmare situation to deal with.
The landlord starts off an eviction process using section 8 (landlord has to prove breach of contract) as he can no longer use s21. The legal aid funded tenant defends the action in court and brings a counterclaim against the landlord for damages. At the first 15 minute hearing the judge sets a trial date for six months hence and asks for expert reports.
The upshot of all this, if the landlord does not win, is the tenant walks away having paid no rent for 9 or 12 months, leaving the landlord paying all costs, and in two recent cases I’m aware of, these costs have been well in excess of £15,000.
This is no exaggeration; these cases are happening right now. Far from protecting good landlords from “rent tape” this innocuous sounding addition to the legislation will mean this scenario becomes a far more regular occurrence. There can only be one result, it will drive good landlords out of the business.
My view is that the no quibble s21 process must be retained at all costs if private rented sector (PRS) is to continue to grow and provide much needed rental accommodation.
This is not to deny there is a small minority of bad landlords out there, but the authorities should use the ample powers they already have to stop bad practice. To bring in a measure such as this which punishes ALL landlords is just counterproductive.
Countless statistics have been bandied about to show how big or small the problem of so called “revenge evictions” actually is, but The National Landlords Association (NLA) and the Residential Landlords Association (RLA) are very concerned about how Shelter’s survey findings are being used: the RLA has commented that they “ignored the inconvenient truths”.
According to the Ministry of Justice figures there were 37,739 repossessions in 2013. This figure represents just 0.5% of ALL tenancies – private tenancies as well as social housing tenancies.
By far the majority of these evictions were for rent arrears. Far less were for issues like ant-social behaviour, damaging the landlord’s property, and not to forget the many instances of where a landlord simply wants to return to live in a home s/he let out short-term. It’s not possible to show from these figures how many evictions where instigated at the request of a tenant who wanted to be re-housed by the council, but this is a substantial number.
David Carter, of the Sheriff’s Office, someone with experience of thousands of landlord and tenant issues has said:
“The Government has already given councils £6.7 million to tackle the problem of rogue landlords and in the last 7 months, 23 councils have inspected more than 6,700 properties and 1,700 landlords are facing further action or prosecution.
“I think the [Ministry of Justice] statistics on actual evictions do demonstrate that the problem is smaller than is being made out and that those rogue landlords could be handled in a way that does not discourage property owners from renting.
“Whilst threatening tenants with eviction is easy, actually evicting them is a little more involved. I have written before about regular delays of 12 to 16 weeks before County Court bailiffs are able to repossess property.”
Paul Shampalina, of Landlord Action, also with years of experience in these matters says:
“Revenge/retaliation eviction was a term recently coined to describe a minority of rogue landlords… this should not be confused with a landlord’s right to exercise a Section 21 notice simply because he/she would like their property back.
“The property market is strong at present and naturally many landlords, a large percentage of which were accidental landlords in the first place, have decided that now is the time to cash in their chips. For others, personal circumstances may have changed meaning they now require the rented property to live in themselves.”
In my view the private members Bill proposed by Sarah Teather, and supported by Brandon Lewis MP, Minister of State for Housing, and Communities Minister Stephen Williams MP, is a very worrying development for all private residential landlords and needs to be vigorously opposed.