The end of no-fault Section 21 (Form 6a) Possession Notices!

Filed in Breaking News, Landlords by on 15th April, 2019 2 Comments

Update: 4th September, Esther McVey (Minister of State (Housing, Communities and Local Government) with reference to their consultation on Overcoming the barriers to longer tenancies that sought views on the potential benefits of longer tenancies in the private rented sector. Read her response here.

Update: 20 July 19: A new consultation “A new deal for renting: resetting the balance for rights and responsibilities between landlords and tenants” has been issued by the Ministry of Housing, Communities and Local Government.

This consultation seeks views on implementing the government’s decision to remove Section 21 of the Housing Act 1988 and improve section 8 eviction grounds.  I encourage all landlords to read the supporting information before completing the consultation questionnaire. The supporting information and consultation document can be accessed by clicking here.

Update 1: The Residential Landlord Association (RLA) has asked all landlords (irrespective of membership) to complete their survey: RLA Section 21 Survey.  The National Landlord Association (NLA) have adopted a different approach and are asking landlords to complete a postcard: NLA Postcard  that will be delivered to the PM at number 10.  Both the RLA & NLA hope to use the results in future discussions with Government as a means to influence the redesign of the Section 8 Eviction Notice process. We encourage our members to complete both.

The Section 8 Notice is expected to replace the Section 21, therefore before you start the survey it’s worth refreshing yourself on Section 8 Grounds for eviction. Section 8 grounds can be found here. The survey takes a little while, so be warned but please persevere!

Note the difference between mandatory and discretionary grounds (Grounds 1 to 8 are mandatory, meaning if the landlord can prove to the court that they apply then the court must grant the possession order. The other grounds are all discretionary meaning the court may not grant possession), also note there is no mandatory ground for Anti Social Behaviour!   

Background:

On 15th April a major housing shake-up announced by Theresa May. Landlords will be banned from serving the accelerated “no-fault” Section 21 (From 6a), Notice for Seeking Possession, within the Private Rented Sector (PRS).

The Prime Minister has revealed plans to scrap controversial rules that allow landlords to seize control of their property with just two-months’ notice once the fixed term has come to an end.

Teresa May said, “the changes would protect more than 4 million rented households in England from unethical behaviour” and “give them the long-term certainty and the peace of mind they deserve”.

Click here to see the BBC’s report.

Supported by the Labour Party, the banning of the no-fault Section 21 means that all possessions will have to be approved by a Court. A possession notice will only be approved by the Court if there is a solid reason stated.

We have yet to see the full outcome of the Government’s response to the consultation of the “Overcoming Barriers to Longer Tenancies in the PRS”. Banning the no-fault Section 21 is the first of a number of recommendations resulting from this consultation. The consultation’s section titled, “A Fairer Deal for Landlords and Tenants, paragraph 24 sets out:

The government intends to change the legislative framework by removing the Section 21 ‘no fault’ eviction process, alongside strengthening the grounds for eviction under Section 8 of the Housing Act 1988 and simplifying court processes to make it easier to gain possession through the courts. These changes would create flexible, open ended tenancies and deliver a more robust system which works for both parties.

In paragraph 29, a further consultation is announced, “We will launch a consultation on the details of a better system that will work for landlords and tenants. The Government will collaborate with and listen to landlords, tenants and others in the private rented sector to develop a new deal for renting.”

I will be some time before we see the results of this newly annonced consultation.

We are still awaiting the outcome of the “Considering the Case for a Housing Court” (call for evidence) consultation. This consultation should provide further evidence to drive the Government towards a quicker and cheaper section 8 possession process with provision for an effective alternative to the no-fault Section 21.

Editors opinion: The Government will have to go through a few more hoops before it becomes law. However, this news today is likely to lead to a knee jerk reaction from landlords who will now be writing and serving no-fault Section 21 (Form 6a)’s whilst they are still legally able to do so.  Tenants on Universal Credit and other high risk tenants are likely to be in receipt of such a notice within the next few days! Landlords, who were considering the serving of such a notice, will now be incentivised to do so and to do so now! 

The Government’s intention to ban the no-fault Section 21 (Form 6a) process demonstrates their lack of understanding on why landlords often resort to such a process. In nearly all instances their will be a reason of some nature. This includes a tenant’s default on the tenancy agreement where the landlord wants possession as soon as possible. Even if the notice of possession goes to Court, under current law the possession cannot be opposed by the Judge. It’s a quicker and cheaper process than when a reason (such as rent arrears or anti social behaviour etc.) is given. In these instances, the landlord’s reason can be contested, possession delayed (or denied) and further costs incurred.

The current possession process via Section 8 or Section 21 where a reason for the possession is given, can be a very lengthy, onerous and expensive process and we do not know when this process will be strengthened more in favour of landlords, if at all. We would therefore recommend that all landlords consider bolstering their rental property insurance with Rent Guarantee and Legal cover. If you already have Alan Boswell insurance, this additional cover can be added at a very reasonable premium Click here for more details. 

If this law is passed in isolation or in advance of the “strengthening of the section 8 possession process and simplification of the Court process (mentioned above), increasing rents may be the only alternative to a Court process, of forcing tenants out. If this happens I suspect it will lead to a rent-capping law or charges of harassment against landlords.

This will be seen as another nail in the coffin for many landlords.  They are likely to consider the PRS a high risk investment, sell and seek alternative safer investment opportunities. The price of properties are likely to fall, however, even so they will still remain as unaffordable to the majority. Landlords with properties in Bristol need not worry though! As I write Paul Smith (BCC’s Cabinet Member for Housing) has just announced on the news that to help homeless people BCC will be happy to purchase your property from you! Based on this announcement I suspect that Bristol City will become a “mecca” for the national homeless!     

I suspect that Local Authorities will now be faced with a deluge of tenants being evicted and seeking emergency accommodation.  Already in short supply, and only available to the most vulnerable, we are most likely to see an increase in homelessness! 

We will advise as soon as we get news of the consultation process. In the mean-time, please do write about your concerns to your MP. Click here to find your MP.

 

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About the Author ()

Rob Crawford is the chairman of the Association of Local Landlords (Wessex). Rob is a practicing landlord with a property portfolio that includes small private residential properties and HMO's. Rob is a qualified letting agent and former owner of Kingfisher Lettings & Management. He is now a share holder of the successful online lettings company Lettingsupermarket.com.

Comments (2)

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  1. Margaret SWATTON says:

    How will we be able to get rid of a tenant, who despite good references, steals from other tenants, threatens and abuses other tenants and uses their room to do drugs, in an otherwise happy HMO. A Section 21 is the only way to evict the tenant and support good tenants who have to put up with very bad behaviour. Over the years I have had 3 tenants like this and Section 21 was the only way to prevent much more serious things happening in response to this behaviour.

  2. Rob Crawford says:

    This concerns us all. To answer the question, we need to wait for details on changes that will hopefully be forthcoming to the current Section 8 and Court process. The nightmare scenario will be if the section 21 is scrapped before these essential changes are made!

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