Public consultation is currently underway on the abolition of Section 21 notices whereby a landlord can terminate an Assured Shorthold Tenancy (AST) and conduct a no-fault eviction.
The Government takes the view that allowing landlords to terminate tenancies without having to give reasons is unfair and not viable in the market where increasing numbers of people rent rather than buy a home.
Liz Shaw, property litigation solicitor at Wake Smith, looks at both sides of the argument and the implications of failing to balance both sides’ needs.
Liz said: “On April 15, 2019 the Ministry of Housing Communities and Local Government announced it would be launching a consultation regarding the abolition of Section 21 Notices.
“At present an AST can be terminated by the service of a Section 21 Notice and it is not necessary for the landlord to prove that the tenancy has been breached.
“In most cases there is no defence to a claim to possession on these grounds, assuming the notice is valid and has been served correctly, and possession proceeds on the “accelerated route” so it is quicker and cheaper than proceedings based on a Section 8 Notice.
“There are not yet any detailed proposals, but it is anticipated that any reforms will strengthen the grounds for eviction under Section 8 of the Housing Act 1988 particularly to include landlord’s power to serve notice to terminate and regain their property when they wish to sell or move into it themselves.
“However, it is thought that to avoid abuse these grounds will be limited to use when the tenancy has continued for at least two years.
“The consultation is for “a better system that will work for landlords and tenants” according to the Government.
“Presumably as part of the consultation, the Government will have to address concerns from landlords that the current process for seeking possession on fault grounds is fraught with difficulties.
“Other questions that need to be considered is whether there will be an exception for student lettings and, if not, will this hinder new students from obtaining housing as landlords will not be sure when, and if, current students will be moving out?
“Tenants might consider it unfair that despite a faultless record of rent payment and compliance with tenancy terms that they may be evicted on only two months’ notice.
“In response, most landlords will argue that it is their property which they have let out on the terms of a mutually agreed contract for a fixed term and obtaining possession once that contract has expired simply endorses their ownership rights as landlords rather than representing any unfairness.
“Failure to balance both sides will result in landlords leaving the market, so reducing the supply of rental properties available which will simply push up rents.”
For further information or advice please contact Liz Shaw at [email protected] or on 0114 224 2041.
