Abolishing Section 21 without making Section 8 fully “fit for purpose” will have dire consequences on our housing supply

Abolishing Section 21 without making Section 8 fully “fit for purpose” will have dire consequences on our housing supply

Yesterday (15th April 2019), the government has outlined plans to consult on new legislation to abolish Section 21 in a bid to end so called ‘no-fault’ evictions.

Although this is not a surprise move, it is one that, if goes ahead as suggested (i.e. full abolition of Section 21), will be game-changing for the private rented sector.

As I have said for many years, the vast majority of landlords only evict tenants as a last resort. At the end of the day, a landlord doesn’t let his property just so he can subsequently evict the tenant, there is always a reason, so the term no-fault is moot. When the property is let, it is an active decision made by the landlord. Unfortunately, circumstances change, for both landlords and tenants, but that’s what most people like about the PRS – its transient nature.

Removing the ability to evict with Section 21 will undoubtedly make any prospective landlords very nervous about embarking on the world of buy-to-let and could encourage existing landlords to exit the market, thus compounding the housing shortage crisis. I also believe we could see a surge in landlords serving section 21’s in the near future, as this could be a step too far, especially for the smaller landlords, which unfortunately will result in more evictions.

I do fully understand the need for families to have greater security and be able to put down roots, but there are several factors within this proposal that need to be carefully considered before an outright ban is implemented.

Changes to Section 8 and Court Processes

It was reported by Citizens Advice that supposedly 141,000 people have been handed eviction notices since laws to ban revenge evictions were introduced in 2015. I just don’t understand how they have collated this information when non-fault means the landlord would not have given a reason.

No-one knows exactly how many Section 21 notices are served every year. However, what we do know is that the most common reason for doing so is rent arrears, as was the case for 56% of landlords who responded to our survey last year.

In this instance, the reason landlords use Section 21 to gain possession rather than Section 8 as was intended, is because it is typically quicker. Landlords have little faith in the current court system and few anticipate being able to pursue rent arrears, so most take the decision to forfeit recovering lost rent and just to get their property back as soon as possible so they can re-let. Section 8 also comes with the added risk that tenants can counter-claim, therefore delaying the process further.

The announcement said that “Ministers will amend the Section 8 eviction process, so property owners are able to regain their home should they wish to sell it or move into it.”

In my view, if Section 8 is going to have to be relied on more heavily, it must be “fit for purpose” and any changes and their application need to be carefully considered. Clearly, if a landlord is going to need strong grounds for possession, there are going to be a lot more court hearings. So, my question would be, are there going to be a lot more judges and resources to handle this increased workload?

The government has said that “Court processes will be expedited so landlords are able to swiftly and smoothly regain their property in the rare event of tenants falling into rent arrears or damaging the property”. However, in truth, we don’t know how ‘rare’ rent arrears cases are because most landlords are writing them off via use of Section 21.

So, in that respect, perhaps greater use of Section 8 might be a positive thing as there will then be more accurate records of rent arrears cases. However, the government must then assist landlords by ensuring money orders are registered as CCJs. This will not only act as a deterrent to tenants who regularly fall into arrears and simply move on, but also enable landlords to pick up on defaulting tenants from their referencing.

Finally, what about all those cases which are less black and white? The cases where the tenant does pay the rent, eventually, but it is always late, refuses to give the landlord access and fails to communicate regularly, leaving the landlord with no choice but to pay the mortgage out of his own pocket until the tenant coughs up? My point is, it is not always one reason why a landlord decides to serve notice, it can be series of reasons which have built up over time, leading to a breakdown in communication. Where will those landlords in that situation stand?
Landlords are feeling very downtrodden at the moment and it’s easy to see why – they haven’t even started to feel the effects of the tenant fees ban yet and already have been hit with yet another potentially industry-changing piece of legislation.

Whatever the outcome, we know it isn’t going to happen quickly as there is a consultation first, but since there is much at stake for everyone involved in the PRS, I would urge the government to fully engage with the industry to understand the consequences of legislative change and consider dilution of Section 21 over removing the use of Section 21 altogether.
So finally, as a landlord, I urge you to complete the consultation on Section 21’s when its released by the Government, to have your say.

Precise Treatment Reduces Pain

Detail needs experts. Expert time is worth it when it saves you a costly mistake. Main objective: Get the property back. Best action: Very precise treatment.

Serving a notice is actually the most important part of the possession process.

It isn’t complicated but one tiny error can cause dreadful problems.

That’s why we say, don’t DIY and don’t use internet amateurs. It’s not worth it.

1. Compliance Errors
If the tenant doesn’t leave at Step1, the notice had better be valid. Because then it has to go to court. Any little error can get a case thrown out. And you have to start all over again.

2. Attempting Short-Cuts.
In an effort to be quick, some internet services aimed at landlords are using short-cuts around the process. But if the tenant doesn’t leave (50%) these practices can backfire at court and the case thrown out.

3. Trying to Save Pennies.
Internet services have mushroomed and landlords can expect to get what they pay for. To get the process done PROPERLY it takes a certain amount of time for an expert to look over a file and be accurate. Our fees cover that expert time.

Chasing courts for dates, arranging advocates and preparing court papers is time consuming. Especially if you’ve never done it before.

Some landlord and agents have served notices themselves. They believed they were saving a few pounds but it often ended up costing them more.

If you lose a claim, the court can order you to pay the tenant’s defence cost, which can run to hundreds or thousands of pounds.

Our in-house Solicitors are there to get your property back as fast as they can. And we protect landlords and agents from themselves.

As experts, we know that in the rush to get things done, errors can happen. And those errors can can come back later to mess up your case – and the whole process has to start again.

You can speed things up – give us accurate information quickly. Help us to help you.

There are services on the web who will prepare papers BUT they get you to pay the court-fee separately and get you to sign the court papers – so in fact they don’t represent you!

If your notice (at Step1) wasn’t drafted or served correctly you risk wasting your court fees and losing a whole lot of time because of a small error.

We won’t let your case anywhere near a court until we have checked every little detail. To make sure you don’t waste time or money, at Step-2 we first only charge part of the fee.

If your notice is fine, then you just pay the balance of the fee and we issue the claim. If there is a problem with your notice or paperwork, we will advise you what to do next.

Courts take the view that possession proceedings can make someone homeless. So they are very careful. If there’s any error in the notice, they throw the case out. It’s the process. Get it right or lose.

If the notice is invalid, you have to start all over again. The weeks or months you’ve waited are wasted. If there were rent arrears, there are now more.

If there weren’t rent arrears, they might now start. More fees. More lost rent. And still no possession. Tenants can be alerted to making a counter-claim.

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