Section 21 use ‘ overstated’, according to LRG research

A controversial change due to be brought about in the proposed Renters’ Reform Bill is the abolition of Section 21 ‘no fault evictions’: it is this, among other measures, which is intended to ‘professionalise’ the private rented sector (PRS). But many believe that the repeal of Section 21 is not feasible without changes in the court system.

Here at Leaders Romans Group, we carried our own research which found that Section 21 is rarely overused, and even more rarely misused.

Currently, Section 21 of the Housing Act 1988 allows landlords to evict tenants without having to give a reason and tenants’ representatives believe that this leaves them vulnerable to “no fault” eviction and so afraid to make complaints to their landlord.

However, LRG surveyed 271 landlords across its estate agency brands Gibbs Gillespie, Hose Rhodes Dickson, Leaders, Moginie James, Portico, Romans and Scott Fraser and found that 80% of landlords have never used Section 21. Of those that had, 6% did so when the tenant was in breach of the lease and only 3% where the tenant was not in breach of the lease.

Pose new challenges

Leaders Romans Group, along with the majority of our landlords, is committed to raising standards. But while we are fully supportive of ‘professionalising’ the private rented sector, many of the proposed changes, including the repeal of Section 21, would pose new challenges which could penalise both landlords and tenants.

It is important to bear in mind that private landlords are vital to meeting increased demand in the rental sector and that unnecessary measures which would result in an exodus of landlords from the market would be detrimental to rental affordability.

We also believe that the Government should re-think its proposals surrounding assured shorthold tenancies (ASTs). It has been suggested that tenants should be permitted to serve notice of two months’ at any point.  This would create considerable uncertainty for landlords, which is unwelcome in an already challenging market.  There has been a request to amend this, so that two months’ notice is only permissible when a tenant has been in the property for at least four months. This compromise would provide some further security for landlords, while allowing flexibility for tenants.

Pressures on the courts

LRG’s research follows the publication of the Levelling Up, Housing and Communities (LUHC) Committee’s report which responded to the Government’s Reforming the Private Rented Sector<https://committees.parliament.uk/publications/33924/documents/185831/default/> policy document.

The committee welcomed the Government’s proposed abolition of Section 21 but requested that exemptions be made. Furthermore, the report states that, ‘The pressures on the courts will be exacerbated by the repeal of Section 21, as landlords will seek to regain possession under Section 8, especially in the case of rent arrears and antisocial behaviour’, and states that the abolition of Section 21 is only feasible if a housing court is put in place – something that the Government has already ruled out.

It is at least reassuring that the Committee understands the importance of consulting with landlords prior to making this substantial change – specifically on how and whether the courts can process such claims at the necessary rate - before Section 21 is repealed. If it was to speak to our landlords, it would certainly find that the Government’s response to no-fault evictions to be extreme, unnecessary, and damaging to landlords and tenants alike. The Government should reconsider this very onerous proposed change.