Section 21 saved – for now…

Section 21 is still in force – but for how long?

Good news for landlords this week. The government has indicated that Section 21 evictions won’t be scrapped for the foreseeable future. The Renters Reform Bill – of which removing the right of landlords to no-fault evictions is a key part – will be put on hold until at least 2021.

As far as we’re concerned, this is a victory for common sense. At Ringley, we have always urged the Government to think long and hard before it ditches Section 21, so we believe this is the right decision at the right time. With the courts facing a backlog of evictions once the possessions ban is lifted, there will be enough litigation to wade through without an impending rule change to deal with.

Official figures point to the fact that only 10% of tenancies are ended by the landlord, not the tenant. This is because a long term tenant is a good investment. There is no void rent loss and less move-in, move-out wear and tear.  But there are legitimate reasons why a buy-to-let landlord may need to evict someone when they have a change of circumstances. At the end of the day the property belongs to them and, within reason, they must be able to repossess it. Section 21 is a useful – and polite – way to evict a tenant when this becomes necessary.

Pre-lockdown the average time it was taking for a private landlord to repossess a property was nearly four months. That was far too long – and will now take even longer. So it is vital that repossessions are supported by an efficient court process.

Regardless of how useful a tool Section 21 may be, the Government proposes to effectively make tenancies open-ended, while at the same time strengthening the rights of landlords who want to recover their properties by giving the Section 8 process more teeth. As we have said in this blog before, getting this right will make or break any planned change in the law.

Last year, more than a third of buy-to-let landlords told a Landlord Today survey that they would consider selling their properties if the government axes Section 21; Another 33% said they would only continue being a landlord if “significant changes” are made to Section 8 first. The study also found that 70% of landlords would be less willing to consider a longer-term tenancy if Section 21 was no longer available to them, while 85% said they would be more selective with their choice of tenant. 

So a change in the law could have unintended consequences. Our view is that all those calling for Section 21 should be careful what they wish for. If Section 8 is not strengthened to give landlords the ability to evict rogue tenants when they need to – and without excessive delays – the market may not be able to meet the demand for more rental homes that we will surely see as the economy inevitably falters post-pandemic.

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Landlords in the firing line – again!

Landlords in the firing line don’t deserve always to be seen as the bad guy

Landlords in the firing line from another consumer group may once again be wondering what they have to do to prove that they are not always the bad guy. Following on from recent calls for tenants to pay no rent if they are suffering financial hardship due to Covid-19, this week Citizens Advice wants buy to let properties to be re-let only if the tenants in them want to move.

The proposal is just one in a list of tenant-related demands made by the organisation, most of which relate to the Coronavirus outbreak. But yesterday Citizens Advice told Letting Agent Today that “properties should only be put on the rental market if the tenant has said they want to move.”

We think there’s a major misconception here. There seems to be an assumption that just because tenancy agreements are for a fixed term, landlords automatically want to change tenants. They don’t.

Ringley Group MD Mary-Anne Bowring says: “The truth is that a sane landlord would want to end the tenancy only if they were experiencing problems with the tenants. Why face a void period if your tenant wants to stay.  A void means not only the loss of a couple of weeks rent but also the need to refresh the property, spruce it up a bit and maybe even change curtains, furniture or carpets”.

Citizens Advice is also calling on the Government to “accelerate its policy to scrap Section 21”. We wholeheartedly disagree with this too and have campaigned to keep a system that we believe is effective. Section 21 is simply a polite way to evict difficult tenants. It stops the court system being clogged up with many small rent arrears cases and gives landlords some certainty that their worst bad debt is the term of the tenancy without protracted court proceedings.

Most property owners who rent a home to tenants do a good job. They are not constantly trying to rip-off or evict renters who pay their bills and look after the property. So why put landlords in the firing line – again!

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