The Renters' Reform Bill is set to bring about a major shift in the landlord-tenant dynamic and within this, it confirmed plans to put an end to Section 21 in England, also known as a ‘no-fault’ ground for eviction notice. With this, Section 8 grounds will be strengthened to allow landlords to recover their property.
Understanding Section 21
For years, Section 21 of the Housing Act 1988 has been a contentious topic in the rental sector. Often referred to as the ‘no-fault’ ground for eviction, it allows landlords in England and Wales to serve tenants notice of intention to seek possession, giving a minimum of two months’ notice. Landlords aren’t obliged to establish fault on the part of their tenants. If the tenant does not vacate the property before the notice expires, the landlord must seek a court order for possession. The court will grant an order if the correct procedures have been followed.
What’s changing for Section 21?
The Bill details plans to simplify tenancy structures by moving all tenancies to periodic. This means that the tenancy will end only if the tenant chooses to leave, or if the landlord has a valid reason, as defined by law through section 8 grounds. Section 21 would therefore no longer be required.
Under current legislation, some tenants face a lack of security and feel reluctant to challenge poor standards due to the risk of eviction without reason.
The new rules aim to empower tenants to challenge poor living conditions and unfair rent increases without fear of being evicted.
After the abolition of Section 21, landlords will need to provide their tenants with a reason for ending a tenancy, such as wanting to sell the property or there has been a breach of contract. However, tenants will be able to choose to end the tenancy at any time, as long as they provide two months’ notice to the landlord.
What will replace Section 21?
The Government will instead strengthen the grounds for possession under Section 8 of the Housing Act 1988, to allow landlords to recover their property in reasonable circumstances.
After a tenant has lived in a property for six months, landlords will be able to evict a tenant under ‘reasonable’ circumstances under Section 8. This includes wanting to sell the property, redevelopment or allowing a close family member to move in to rent the property.
The ground for anti-social behaviour will also be strengthened. Landlords will be able to make a possession claim immediately, and the ground would cover behaviours capable of causing irritation. This means that the court will consider a wider range of tenant behaviours.
The Government has warned landlords and agents that any attempt to find loopholes will not be tolerated. They have also stated that it would consider the case for new strengthened penalties to support those currently in existence, including the power for councils to issue Civil Penalties Notices.
When will Section 21 be abolished?
The Renters Reform Bill must pass through Parliament before it becomes law. In most cases, this can take up to a year after a first reading in Parliament.
The Government proposes two stages to move properties over to periodic tenancies:
- Stage one: transition all new tenancies to periodic
- Stage two: move all existing tenancies to the new system under a date given by the Secretary of State
If you have any questions or concerns about these upcoming changes, speak to your local branch of lettings experts
