Jessica Harris discusses the impact of abolishing no-fault evictions in PropertyWire
Jessica’s article was published in PropertyWire, 22 July 2024, and can be seen here.
Abolition of Section 21 notices
The new Labour government used the King’s Speech to set out plans to immediately abolish Section 21 ‘no-fault’ evictions. These allow 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.
The changes will supposedly simplify tenancy structures by moving all tenancies to periodic: 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. These include the landlord wanting to sell the property, redevelopment or allowing a close family member to move in to rent the property, or if there has been a breach of contract or anti-social behaviour.
The proposed bill, initially introduced by the previous Conservative government, was described by homelessness charity Shelter as a “once-in-a-generation opportunity” to address problems facing renters. It had reached its second reading in the House of Lords when the general election was called and parliament dissolved, before being resurrected by Labour in the King’s Speech.
Homelessness charity Crisis said no fault evictions are the “leading cause of homelessness in England”. A Shelter analysis of Ministry of Justice figures earlier this year found 26,311 households in England have been removed from properties by court bailiffs as a result of S21 since 2019. In 2023 alone, 9,457 households were removed by bailiffs, up 49% from 6,339 households in 2022. Meanwhile, a further 30,230 landlords in England started S21 proceedings last year, a 28% rise from 2022.
Crucially, however, since S21 is a “no fault” possession notice, it’s impossible to know why the notices are served. The ignorant and widely accepted view of S21 notices is that it is an unfair eviction notice served indiscriminately by landlords. This is not the case. There is a lack of understanding of the legal system and deliberate attempts by politicians to misguide voters. In many cases, S21 notices are served to remove tenants at the end of the fixed or periodic term that have violated the terms of their tenancy agreement. But this is not made clear.
When dealing with rogue tenants, it’s often easier to issue S21 notice and wait for the fixed or periodic term to end before repossessing the property, rather than serving a S8 “with grounds” eviction notice, and potentially have the ground(s) for eviction contested in court by the tenant; a long drawn-out process. Without recourse to S21 notices landlords will be left unfairly exposed; a cheap ploy to gain votes without consideration of the consequences.
Furthermore, abolishing S21 won’t make much difference to decent landlords. The narrative that landlords that are not interested in long-term good tenants is mistaken. It is expensive to change tenants, and there are risks attendant in removing good tenants from premises. Abolishing S21 notices may aid in suppressing the minority of rogue landlords from operating. But at what cost? Abolishing S21 notices will impact tenants more than landlords. There will be a backlash against unintended targets: tenants.
If landlords don’t have an easy method to regain possession, they will either sell, or change to an Airbnb/short-let model, or alternatively become more selective, multiplying difficulties for tenants in securing accommodation. A simple and sensible decision by landlords to make tenant guarantors a requirement will increase the tenant barrier to entry; one many won’t be able to overcome.
Moreover, there will be an increase in S21 notices being issued before the deadline, by landlords that have noticed concerning behaviour from current tenants. Once the ban is implemented, landlords know it will become more difficult to resolve issues if they escalate.
A further consideration is the likely response of insurance companies: the legal costs for evictions will suddenly become more expensive, resulting in higher premiums. Landlords will have to deal with increased operational costs.
If landlords currently heavily rely on S21 to evict rogue tenants – a process that is not resource heavy on the courts – this begs the question as to what will happen once S21 is abolished? There will be an increase in the usage of the resource-hungry S8 route. Unfortunately, our courts are already overwhelmed with S8 eviction cases. We have been assured that there will be funds made available to our legal system to handle the expected increase in S8 cases after S21 ceases to exist (itself perhaps an admission as to how misleading the S21 statistics are). But the government won’t be able to direct sufficient resources into the legal system to produce a workable eviction process. Most landlords share the same concerns, which is why it will only result in increased hardship for tenants to locate accommodation.
