The Abolition of Section 21 Notices. What Will it Mean to YOU as a Landlord?

Evictions. For landlords right now, they’re a hot topic.

What’s happening? When will it happen, and how could it affect you if you rent out your property?

Information is power, and we recognise that half-knowing something – anything, in fact, is never a great feeling

In recent weeks, our team has dealt with several phone calls about this issue. So, let’s put Section 21 “No Fault” Notices to bed, at least in terms of what we do know for certain. And,  and what, if anything, you can do about it.

We’ll break everything down clearly, and offer qualified advice about your next best course of action.

Firstly, as we often (always) say, being a landlord is much more challenging in 2023 than 10, or even five years ago. Undoubtedly, there’s a lot to know about regarding legislation and compliance. So, get in touch if you’d like to discuss any of the key points raised in this blog.

Section 21 – As It Stands Now

In brief, A Section 21 Notice allows you to give your tenants two months’ notice to quit after a fixed period of six months’ occupancy. Importantly, you may secure re-possession without giving them a reason why.

In theory, this sounds unfair. Significantly so, in fact. Why should tenants who have lived in your property for several years and see it as their home suddenly have to up sticks to find somewhere else?

However, there’s a “but” here.

As we’re sure you’ll agree, landlords actually want long-term, peaceful and respectful tenants who pay their rent on time and look after their environment. In fact, these are nirvana. Shangri-La. They’re those under-the-radar hero professionals who make your life so much easier.

Usually, you would only evict people if you wanted to sell, or use the property yourself. Commonly, Section 21 Notices simply bring a tenancy to an end, without you having to go to court (in theory). Unless – they were causing trouble, in which case you would issue a Section 8 Notice, giving specific grounds.

(Caveat here: Section 8 Notices often involve senior-level legal representation, so do seek advice if you need to evict tenants for a defined reason.)

The Current Plans

HM Gov laid out what we can only conclude are some fairly “assertive” proposals in June 2022, with a White Paper called “A Fairer Private Rented Sector” Then, a House of Commons research briefing published a summary of this White Paper in April 2023 stated the intention…

“…to abolish Section 21 evictions and introduce a simpler, more secure tenancy structure. A tenancy will only end if the tenant ends it or if the landlord has valid grounds for possession”.

However,

…” New grounds will be created to allow landlords to sell or move close family members into the property.”

And,

Grounds covering rent arrears and anti-social behaviour will be strengthened.

So, strengthening Section 8 appears to be on the cards. Plus, the burden of proof that comes with its sub-divisions: Ground 14 and Ground 7a. Plus, a caveat about “personal”, or family re-possession.

Interestingly, the National Residential Landlords Association (NRLA) has been lobbying for Section 21 to be abolished, or at the very least amended, for some time. Also, they’re keen for the courts to improve their systems regarding Section 8. Equally, groups lobbying for tenants want to ensure that Landlords will not have the power to abuse the planned reinforcements to the Section 8 grounds.

All this has, to be fair, led to disquiet.

Your Concerns

Whilst we wouldn’t want to tell you how to think or feel, we’re acutely aware of the strength of feeling in the local Landlord community regarding evictions. In other words, you’re telling us that you’re worried.

And the problem is this:

Rent arrears.

As you know, there’s a two-month lag in issuing a Section 8 notice if your tenants fail to pay their rent. Then, if they refuse to leave on the required date, you have to apply for a possession order, at which point there can be delays. Why? Because the court system can and does move at a snail’s pace. 

Meanwhile – no rent. Zero. Zilch. Nada. Of course, if you have a mortgage on the property, you could be looking at a financial car crash. 

Legislation Frustration

Evicting a tenant requires you to follow precise, defined steps promptly, and within set dates. Unfortunately, the judge can throw out your case if you get anything wrong. In this instance, you’d need to restart the whole process.

Although you can apply for an accelerated possession order, we’re hearing that landlords are already dismayed at the apparent glitches in the court possession process. The thinking here is that abolishing Section 21 Notices without improving the court system paves the way to a hellish experience for Landlords.

Do We Have a Date Yet?

The government has spoken of a “fair deal for renters” as a “priority” as recently as February this year.

Right now, a team of Civil Servants is hard at work drafting the Renters’ Reform Bill as part of the levelling up agenda that’s been all over the news in recent months.

The new Bill has not yet started to make its way through Parliament, but:

It’s likely to become law by the Spring of 2024.

Realistically, you can expect all new tenancies to be subject to the new laws in the autumn of 2024, with existing ones changing over before the end of 2025.

Other Things to Know, and Be Aware Of – About ASTs

• All new tenancies will move from being Assured Shorthold (AST) to periodic tenancies. This means ASTs will no longer exist, and there will be no set end date. Any existing ASTs will also convert to periodic ones.
• Thus, a tenancy will end only if the tenant chooses to leave or you have a valid reason as defined by the new Section 8 laws.
• In most cases, the first six months of a tenancy will remain protected for tenants NOT in breach of their agreement.
• You will have at least six months’ notice of the effective dates and there will be at least 12 months between stage one and stage two.

What This Means for You, and What We Think

In summary, the implications here at that as a Landlord, with a few exceptions, it’s likely that you will ONLY be able to recover possession of your property through the court by satisfying one of the Section 8 grounds

In practice, it remains to be seen how the government and the courts will implement these developments seamlessly. After all, we think it’s a major overhaul of current practices and systems. Let’s hope that everyone has access to the wider picture and the full ramifications of change when it comes to the Bill becoming law.

So, hold fast, and get in touch with the Clarity team if you’d like some guidance and advice specifically for your position.