What will happen to the Section 21 notice? (April 2019)

section 21 notice

What is a Section 21 notice?

Serving a Section 21 notice is currently the only way for a landlord to seek possession where the tenant is either not in breach of the tenancy or one several pre-advised grounds are not available. The vast majority of tenancies end because the tenant serves notice and many landlords never serve a Section 21 notice. For the most part, tenants pay the rent on time and look after the property.

Levelling Up for Landlords: Government White Paper for Landlords and Renters

Section 21 and the How to Rent Guide

In 2015, the government introduced a great little booklet entitled the ‘How to Rent’ guide. Its aim was – and still is – to inform and educate tenants and landlords of their rights, in the hope that it will go some way towards helping the industry stamp out bad practices.

Today, that booklet serves as a helpful checklist for anyone searching for a house or flat to rent and offers plenty of advice to guide tenants and landlords through every step of the letting process.

So, what does the How to Rent guide have to do with serving a Section 21 notice?

To issue a Section 21 notice to a tenant, a landlord must show that they provided their tenant with a copy of the How to Rent guide at the beginning of the tenancy. If this cannot be evidenced, a Section 21 notice cannot be issued.

So the How to Rent guide is a pretty important piece of a landlord’s armoury.

Section 21 Notice – After 1st October 2015

For landlords whose Assured Shorthold Tenancy (AST) was created after the 1st October 2015, it’s important to serve ‘Form 6a’ for no fault possession and hand over the following documents to tenants prior to them signing the agreement:

A failure to comply with these requirements can invalidate the notice. This does not even take into account ensuring it is not served too early or acted upon too late. Evicting a tenant can be a legal minefield.

If the property is a HMO and requires a licence, this must have been obtained before the agreement is signed.

Finally, landlords must protect the deposit with a government-approved scheme and serve the relevant prescribed information within 30 days.

This importance of the signature can’t be underestimated either – it confirms that tenants have been provided with an up-to-date version of the documents and is a landlord’s safeguard!

Section 21 Notice – Before 1st October 2015

If the fixed term tenancy was created prior to 1st October 2015, no ‘How to Rent’ guide was sent out and the tenancy has now lapsed into a statutory periodic tenancy, the section notice you can serve is a Section 21(4)a.

Because of the lapsed date, remember that landlords cannot seek possession against the tenant during the first four months of the tenancy. It’s important to note that when the tenancy is a replacement tenancy, the four-month period is calculated by reference to the start of the original tenancy and not the start of the replacement tenancy.

We’ll do the paperwork

We understand that the amount of paperwork involved in property ownership and lettings can be a bit overwhelming at times.

Although it can be time-consuming and laborious, getting your documents right beforehand will save you a lot of time, money and headaches in the long run.

With our Complete plan, we’ll take care of all your paperwork – including serving notice if you need us to. We’ll also pay your rent every month, regardless of whether the tenant pays or not.

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Future changes to Section 21

Earlier in 2019, the government announced that they intend to put an end to ‘no-fault’ evictions.

This decision was made in response to a 2018 consultation: ‘Overcoming the Barriers to Longer Tenancies in the Private Rented Sector’.

The consultation identified that there was no tenant consensus around ‘mandating a certain tenancy length’. It additionally noted that the response from landlords was for no change to the current position. The alternative to giving the tenant the security of a long-term tenancy is to remove the ability of the landlord to end a tenancy without a genuine and evidenced reason.

2019: the beginning of the end for Section 21

In the Queen’s Speech on Thursday 19th December 2019, it was announced that a new Renter’s Reform Bill will “introduce a package of reforms to deliver a fairer and more effective rental market”.

The Bill is said to put an end to no-fault evictions by removing Section 21, yet will also “strengthen the rights of landlords” who need to legitimately gain possession of their property.

A new lifetime deposit will also be introduced so that tenants will not need to save for a new deposit every time they move house.

What will replace the Section 21 notice?

If Section 21 is changed or completely repealed, the route for landlords to seek possession would be under Section 8 of the Housing Act 1988.

Section 8 allows for the landlord to seek possession during either the fixed term or the periodic element of a tenancy under either pre-advised grounds or breach of tenancy grounds.

An overhaul of Section 8 and the Schedule 2 grounds would be required to ensure that landlords can get possession of their property, if, for instance, the landlord wanted to sell. At the moment, in this scenario, the landlord either sells with the tenant in situ or serves a Section 21 notice. A new ground in Schedule 2 would be required to enable the landlords wanting to sell to claim possession under Section 8.

If Section 21 is abolished, the government would need to address this ‘grey-area’. With no way to serve notice to sell, landlords may not be willing to buy into a market without an easy exit route and lenders would be reluctant to lend to potential landlords.

How might Section 21 changes be implemented?

In most cases, possession proceedings after the expiry of a Section 21 notice are currently carried out under an accelerated possession proceeding. Ordinarily, this is a paper process and only requires a court hearing when either more information is required or the tenant raises a defence that the judge needs to understand more fully. A Section 8 possession proceeding currently always requires a court hearing.

It is hard to imagine that the courts could cope with existing Section 8 proceedings in addition to those that would have been dealt with under Section 21 proceedings as well. The location of the court will influence the amount of time between the court application and the hearing –  and courts in London already take much longer.

The government may examine the experience of Scotland, which went through a similar process and eventually scrapped their equivalent of Section 21 in 2017 and replaced it with a list of reasons why a landlord could bring a tenancy to an end.

Many tenants have expressed that they are fearful of complaining of disrepair to their landlord in case their complaint is met with a Section 21 notice. There is legislation in place to deal with this in Section 33 and 34 of the Deregulation Act 2015, as well as the Homes (Fitness for Human Habitation) Act 2018 – so why are tenants still tentative?

The answer is that the real issue is not the Section 21 notice itself – but the lack of enforcement. Are the government proposing the repeal of Section 21 as admission that enforcement is not working and they have no idea as to how to solve the problem?

What’s your opinion on this proposed change to section 21? Leave a comment below and let us know your thoughts!

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