Government announces intention to abolish 'No Fault Evictions'
The Government is today announcing its intention to abolish Section 21, so-called ‘no fault’ repossessions in the private rented sector.
Section 8 evictions are also set to be reformed in England and Wales with a consultation launching shortly on the Government’s plans.
Section 21’s Scottish equivalent has already been binned north of the border.
ARLA chief executive David Cox said this morning: “Today’s news could be devastating for the private rented sector and landlords operating within it.
“The effects of the tenant fees ban have not yet been felt, and now the Government is introducing more new legislation which could deter landlords from operating in the market.
“Although in the majority of cases there is no need for Section 21 to be used, there are times when a landlord has no choice but to take action and evict tenants from a property.
“Until we have greater clarity on the changes planned for Section 8, today’s news will only increase pressure on the sector and discourage new landlords from investing in buy-to-let properties.
“This comes at a time when demand is dramatically outpacing supply and rent costs are rising.”
He said that ARLA Propertymark will be engaging with the Government to ensure ministers fully understand the consequences of any changes, and all changes are based on evidence, so landlords have the ability to regain their properties if needed.
The National Landlords Association slammed the move, with chief executive Richard Lambert saying it will make ‘fixed term’ meaningless, and creates a new system of indefinite tenancies by the back door.
The Residential Landlords Association has also warned against abolition of the right to regain possession of a property for landlords in England and Wales, without them having to give a reason.
Rob Wellstead Managing Director of Lenwell said: "For most landlords of Lenwell this will not have an impact as they are letting their property on a long term basis.
Landlords will still be able to regain possession of their property where the tenant is in breach of the tenancy using Ground 8 notices.
However, the inability to use Section 21 as a way of regaining possession of the property will make eviction more complex, longer and ultimately more expensive for landlords. Clearly, some landlords will require their property back in the event they would like to sell, move back in or complete extensive works, for those landlords we need to see the detail of the Governments proposals to ensure adequate provisions have been made to enable these landlords to remain in the market."
David Smith, policy director for the RLA, said: “Whilst the RLA recognises the pressure being placed on Government for change, there are serious dangers of getting such reforms wrong.
“With the demand for private rented homes continuing to increase, we need the majority of good landlords to have confidence to invest in new homes.
“This means ensuring they can swiftly repossess properties for legitimate reasons such as rent arrears, tenant anti-social behaviour or wanting to sell them. This needs to happen before any moves are made to end Section 21.
“For all the talk of greater security for tenants, that will be nothing if the homes to rent are not there in the first place. We call on the Government to act with caution.”
What is a Section 21 Notice
Section 21 is a notice served on a tenant of at least two months served after the first six months. As long as the tenant is not in a 'fixed term agreement' a Section 21 is an effective way of a landlord regaining possession of his property.