Housing Act 1988

Proposed amendments to Section 21 of the Housing Act 1988, and what it means for landlords

Posted in Landlord and Tenant.

Section 21, what is it?

Section 21 in its current form, gives landlords the power to issue notice to their tenants to initiate gaining possession of the property at the end of their fixed tenancy or break clause date without giving any reason for the eviction.

The notice must give the tenant 8 weeks’ notice and is subject to the landlord complying with certain requirements at the start of the tenancy. In particular, the landlord must have issued the following to the tenant before the commencement of the tenancy:

  1. Up to date gas safety certificate;
  2. Energy Performance Certificate; and
  3. The latest version of the Governments ‘How to Rent’ guide.

However, recent announcements reveal that the Government is set to shake up the rental industry by removing this right.

Proposed changes

The Secretary of State for Housing, Communities and Local Government, Rt. Hon James Brokenshire announced the proposed abolition of the Section 21 process alongside the PM Theresa May in April 2019, saying:

“Under the proposals, landlords will have to provide a concrete, evidenced reason already specified in law for bringing tenancies to an end… to ensure responsible landlords have confidence they will be able to end tenancies where they have a legitimate reason to do so, ministers will amend the Section 8 eviction process, so property owners are able to regain their home should they wish to sell it or move into it.”

The abolition of Section 21 is part of a wider package of government reforms aimed at rebalancing the relationship between tenants and landlords to deliver a fairer, better quality and more affordable private rental market.

How do the amendments to Section 21 affect landlords?

The key point to note is that if landlords want to regain possession of a property, they will need to use the Section 8 process; meaning Landlords would only be able to issue a notice to evict if there are ‘reasonable grounds’ to do so. This would include points covered under Section 2 of the Housing Act 1988, such as unpaid rent or antisocial behavior.

One saving grace is that the changes will not be retrospective, and so existing tenancies will not be affected!

The government has also indicated following the abolition of Section 21 they will look to expedite the court process to enable landlords to regain their property swiftly in the event that tenants fall into rent arrears or damage to the property. Although, we await further details of what this will entail.

Summary

Section 21 has long been used by landlords to overcome the ineffectiveness of the Section 8 process, which is lengthy and places onerous requirements on the landlord in satisfying the requirement to gain possession. Therefore, it is feared that without the security of the Section 21 process, landlords will leave the already strained rental market.

It is uncertain when the changes will come into effect, however, the Government will need to introduce and pass legislation in Parliament to make the amendments. The indications are that the Government intends to bring in legislation as soon as possible.

Watch this space!