Tenant-landlord rights changes are brewing

Do you remember the lively debate last year within the lettings industry when Ministers announced that they intended to bring in compulsory three-year long tenancies?

It was part of Theresa May’s plans to reform the private rental sector and give tenants more power and stability when they rent.

But after listening to landlords, tenants and letting agents, the government decided instead to reform the system of evictions for those renting in England.

Scotland reformed its evictions laws in 2017 and Wales is looking at a reforms too.

“Tenants [in England] had mixed views on their preferred length of tenancy, calling for a variety of lengths depending on their needs and circumstances,” the government says.

“It is clear that a ‘one size’ approach to tenancy length will not meet the needs of the range of households and different types of landlord operating in the market today.”

So three-year tenancies are out, and instead a radical reform of the eviction process is on the cards instead.

This will see evictions under Section 21 of the Housing Act 1988 or ‘no fault’ evictions (as they are known) banned.

In return, Section 8 evictions will be ‘simplified’ to make it easier and quicker to get rid of genuine problem tenants through the courts who have broken the terms of their contract.

Landlord rights are changing, they will no longer be able to evict a tenant without giving a reason, as they can now, and will have to go through the courts rather than just serving a Section 21 notice.

But if the government was hoping letting agents would welcome banning Section 21, they have been disappointed.

ARLA Propertymark opposes the proposals. Its Chief Executive David Cox says: “The Government’s plans could be devastating for the private rented sector and landlords operating within it.”

Cox claims that the proposals will, unless the government launches a dedicated housing court at the same time, clog up the current court system with the expected increased volume in eviction cases.

This will make landlords nervous about how easily they can evict errant tenant, which in turn it is claimed will lead to even more landlords leaving the sector. This will lead to a reduction in stock, and riskier tenants being excluded from the market as landlords become more risk averse, ARLA says.

It is also worried that many of the nitty-gritty clauses within the proposed reforms will have a significant impact on landlords and lettings agents. These include:

  • Removing break clauses from fixed term tenancies, making it more difficult to eject tenants
  • Requiring landlords to wait two years before being able to evict a tenant if the landlord wishes to move back into the rental property
  • Weak framing of the proposals that will enable serial rent defaulters to ‘play’ the system and make it difficult to prove anti-social behaviour
  • Lack of a pilot to try out the new system – mistakes and unintended consequences will have to be ironed out on letting agents’ own time.

A consultation on the proposals finished on October 12th 2019, and a response from the government is expected soon with legislation expected in 2020.
Author: Nigel Lewis, property journalist