The UK government’s proposed changes to legislation governing the private rented sector will end no-fault evictions. Section 21 of the Housing Act 1988 is set to be abolished, meaning no-fault evictions will no longer be possible.
Homeless charity Shelter has welcomed the plans, pointing out the number of no-fault evictions carried out by bailiffs has increased by 143% in a year, from 792 in October 2021 to 1,924 in October 2022.
However, the National Residential Landlords’ Association fears there’s a risk of landlords leaving the sector as a result of the changes – further reducing access to rented housing for tenants who can’t afford to buy their own home.
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What is the current law in relation to evictions?
Under the current law, Section 21 permits private landlords to evict tenants from their properties under an assured shorthold tenancy agreement, without having to prove any fault on the tenants’ part. This is why it’s known as a no-fault eviction.
However, critics of the current law claim this has a detrimental effect on the tenants’ wellbeing, particularly in an emotional sense, because they are continually under threat of their tenancy ending at short notice.
Research revealed that the law has left tenants reluctant to ask for repairs to their property, even though it’s their right; or challenge a rent increase; because they fear the landlord might simply evict them.
A survey on overcoming longer tenancy issues in the private rented sector concluded many tenants felt unable to plan for the future because of housing insecurities. This was having a knock-on effect on their mental health and their children’s education.
What do the changes mean for landlords?
Under the new legislation, known as the Renters’ Reform Bill, tenancies will all transition to a periodic structure. They will end only if either the tenant chooses to leave, or if the landlord can provide a valid reason for terminating the agreement.
What constitutes a valid reason will be outlined in the legislation. This can include the landlord wishing to sell the property or move into it. Under these circumstances, they must give the tenant two months’ notice.
Other reasons for eviction can include repeated or serious rent arrears, or the tenants causing damage to the property.
The role of Section 21 will be replaced by the strengthening of Section 8 of the Housing Act 1988. This will enable landlords to gain possession of properties rented by anti-social tenants, or to sell their rental portfolio if they need to do so.
Welcoming news of the changes, Shelter said no-fault evictions were causing too many people to become “needlessly” homeless, turning their life “upside down”. However, landlords already feeling the pinch of the current economic crisis may decide to sell up if the new legislation makes their life even tougher, according to the NRLA.
What do landlords say about the changes?
A poll of 700 UK landlords in 2022 suggested only 22% supported scrapping no-fault evictions. They feared they could be left vulnerable to problem tenants and said they would consider selling their rental properties if the law changed.
Landlords invest in properties to earn an income, but difficult tenants can end up costing them money. It should be a mutually beneficial arrangement – so, the landlord makes a living, and the tenants have a pleasant home.
However, it doesn’t always turn out that way. For example, if rowdy tenants damage the landlord’s furniture due to partying or general carelessness, it can end up being a costly business. Not only will the landlord need to provide new furniture for future tenants, but it could increase their insurance premiums.
Landlords fear they could be facing more bureaucracy before they can get rid of problem tenants if no-fault evictions are banned, according to the NRLA.
When will the changes be introduced?
The government says the Renters’ Reform Bill will “redress the balance” for 4.4 million private rental tenants and their landlords.
The Department of Levelling Up, Housing and Communities previously announced the Bill would be introduced during the current session of Parliament, which concludes in May 2023.