Landlord Action says more landlords are using Section 21 in 2014 than ever before.
Paul Shamplina, Landlord Action MD said:
“Since we started in 1999, which incidentally was soon after the accelerated Section 21 procedure was introduced, we have never had so many instructions from landlords and letting agents wishing to proceed to court to obtain possession orders under Section 21.”
Last year, there were 34,080 claims issued under the accelerated procedure, which was an all time high since its inception. I believe 2014 will be even higher.
In quarter one of this year, there were 47,220 claims issued at court for standard procedures with hearing dates and accelerated Section 21s. In quarter two, there were 38,509 claims issued.
The total number of claims issued for all procedures in 2013 was 170,451. This was 20,000 more than in 2012.
This trend of more landlords opting to recover possession using the section 21 entitlement, where a hearing date is not required, is because most want and need their property back as quickly as possible.
Landlords often need to get their defaulting tenants out ASAP as they too can suffer their own financial difficulties if they do not get a paying tenant in and start to receive income to pay off mortgages and other such property running costs.
Most simply don’t want to risk the possible complications and delays which can be linked to Section 8, such as tenants filing defences.
The most common defences under section 21 cases are:-
• Deposits not being protected
• Prescribed information not being served correctly
• Incorrect information on the notice
• Section 21 notice served incorrectly
• Tenants requesting a 42 day possession order under mitigating circumstances
Lots of landlords are being forced down this route because tenants are being encouraged by councils to stay in the property and not vacate due to the county’s overwhelming shortage of social housing.
Councils will only act when there has been an eviction date set, therefore, tenants will not leave the property of their own accord as they would effectively make themselves homeless, forfeiting the chance to be re-housed.
Of course, with tenants experiencing cuts to their Local Housing Allowance (LHA) benefit, many landlords are also keen to re-gain possession so that they can re-let their property at a higher rate to private tenants, because demand is so great, especially in the south of England.
All this is contributing to the shortage of available housing for LHA tenants.
We have many cases where there are quite significant rent arrears, but landlords are writing it off just to get vacant possession, as they know there is little chance of recovery.
In addition, with a more robust sales market once again, lots of smaller landlords (who perhaps never intended to become landlords in the first place) now want to sell their properties, because the increased value in their asset means they are no longer in negative equity. They want to ‘cash in their chips’ while they can.
Paul Shamplina says “In my opinion, with such an increase in demand, there will be some big changes in the future with regard to section 21’s, their time limits and when they can be served… so watch this space.”
— LandlordZONE (@LandlordZONE) October 21, 2014