Section 21 changes and how this will affect landlords by Fariz Uvais
3rd July 2019
3rd July 2019
Being a Landlord is not easy at the best of times, but with new proposed changes to obtaining possession, many landlords may be questioning as to whether they are better off investing their money elsewhere.
Currently, a landlord wishing to end an Assured Shorthold Tenancy has 3 choices. Firstly, to serve a “Section 21” two months’ notice once the term of the tenancy has ended and to seek possession without having to give any reasons for doing so (i.e., a no-fault eviction). Secondly, a landlord can serve a “Section 8” notice and seek possession by proving a Statutory ground of possession (for example, a breach of the terms of the tenancy agreement, such as rent arrears) which will result in a Court hearing, which leads to an Order for possession being made. The third option is to serve both a Section 8 notice and a Section 21 notice and bring proceedings in the alternative which again will be listed for a Court hearing when a Judge will consider the evidence and grant a possession order if the landlord is able to satisfy the requisite criteria.
The Government is looking to consult on new legislation to abolish Section 21 Housing Act 1988 notices (the no-fault option).
In their press release of 15th April 2019, “Government announces end to unfair evictions” it was stated that change was necessary so as to provide tenants more secure private rented accommodation.
Section 21 claims rarely require a Court hearing, yet with Section 8 claims, as they always require hearings, the process takes on average between 5-6 months before tenants are evicted, usually with the assistance of a bailiff or a High Court enforcement officer.
The proposal is to remove Section 21 notices, speed up the Section 8 eviction process and to amend the grounds of possession to include new grounds when a property owner wants to sell the property or to move into it.
As expected, not everyone is keen on these new proposals.
The Residential Landlord Association surveyed over 6500 landlords and agents, of which half stated they would sell their properties if the changes came into force.
So are Landlords right to be concerned? The short answer is yes.
If the Government decides to abolish the Section 21 route then they will need to make sure that they have the systems in place to cope with the increase in Court hearings and ensure the Court process is sped up so as to prevent unnecessary costly delays.
Fariz Uvais is a Consultant Solicitor at Fahri LLP based in Whetstone North London. Write in and ask your legal questions. Fariz will try and answer your questions in Palmers Green LIFE each month. Send your questions to Fahri LLP, 1268a High Road Whetstone, London N20 9HH or by email to email@example.com. Tel: 0203 813 8457