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BLOG: Why abolishing Section 21 isn't all bad news for landlords

landlord action evictions|renters reform bill paul parliament

Yesterday I spoke to a room of 200 anxious landlords. The uncertainly surrounding the Renters (Reform) Bill really has whipped the housing market into a frenzy with landlords serving notices, selling up and exiting the sector in their droves. 

The mere thought of Section 21 being abolished and fixed term tenancies no longer being an option is enough for many property investors to ‘tap out early’.

Coupled with the recent Section 24 tax implications, the seemingly endless hikes in mortgage interest rates and looming EPC legislation, it’s easy to see why landlords are running scared. 

But are we perhaps focusing so heavily on the negatives we can’t see the wood for the trees?

Consider the reasons why we use Section 21 in the first place. Perhaps it’s due to rent arrears or the landlord is looking to sell?  Could it be anti-social behaviour, damage or neglect to the property or some other breach of contract?  Maybe it’s just the inconvenience of an inconsistent payer or the landlords wants to move into the property themself. 

Too weak

Whatever the catalyst, the majority of these reasons are already existing eviction grounds under a Section 8. So why don’t we use them?

It's simple. The current Section 8 grounds are weak. Most are discretionary, they’re heavily evidence-based, they require a hearing and ultimately possession is only granted if the judge is satisfied with the merits of your case. It’s time-consuming, costly and tricky.

Consider also, the number of landlords who fall foul of legislation when it comes to serving a Section 21. 

While the Accelerated Process aims to avoid a hearing, it’s absolutely crucial that the tenancy paperwork is accurate otherwise your five-month wait for possession may fall at the last hurdle when you learn your notice was never valid in the first place. 

Retaliatory

Cries of 'retaliatory eviction', 'deposit breaches', ''missed gas safety certificates or denying receipt of the notice altogether are increasingly common occurrences now as tenants fight tooth-and-nail to suspend repossession proceedings.

Under the reforms now going through parliament, the government has promised us a new ‘beefed-up’ anti-social behaviour action plan, meaning the already-present but rarely-utilised Ground 14 for anti-social behaviour will be strengthened. 

And Ministers have assured us that new mandatory grounds for eviction to sell, bad-payers or moving in a family member, will be introduced.  

Looking at the rise in rents driven by the enormous increase in demand for private rented stock coupled with the fact that house prices are on the decline, perhaps there’s never been a better time for the opportunistic landlord? 

Hiding place

One could even argue that due to the increased competition for houses, tenants will be more inclined to settle in a property for longer and keep their noses clean, for fear of being exposed as a bad tenant. The alleged ‘no-fault’ Section 21 notice has after all, been a great hiding place for everyone.

Cheaper houses, more rental applications, more committed tenants and the ability to command a higher rent – what’s not to like?

And when we come to seek repossession of our properties, it will be for the right reasons. We can be honest with ourselves and our tenants about why we need our property back. A more transparent and robust process all round, leads to a more stable environment for the private rented sector. 

It seems to me the future is brighter than we think. Perhaps, the future is for landlords after all.

Victoria Valentine is an evictions advisor at Landlord Action.

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