The landscape of the UK rental market is undergoing significant changes, with a focus on balancing the rights and concerns of both landlords and tenants.
One pivotal change revolves around Section 21 repossessions and the government’s commitment to reforming the court system before its abolition. These reforms aim to address the extended delays in court processes, which can be especially frustrating for landlords facing tenant-related issues.
As of 24/10/23, the government has confirmed that the plans to abolish Section 21 evictions in England and Wales will be postponed indefinitely, with implementation hinging on court system reforms.
What does this mean for tenants and landlords moving into the future?
Section 21, is a legal provision that allows landlords to regain possession of their properties with relatively less stringent grounds compared to Section 8. It is used as a tool for landlords to reclaim their property for legitimate reasons, such as non-payment of rent or antisocial behaviour
The potential abolition of Section 21 is a topic that has sparked debates and concerns. While it aims to provide tenants with increased security and protection against no-fault evictions, there are apprehensions that it could deter responsible landlords from participating in the market.
This is because Section 21 provides landlords with a relatively simple and flexible process for regaining possession of their property. It doesn’t require them to specify a reason for eviction. Abolishing the rule means landlords would need to rely on Section 8, which often requires proving specific grounds for eviction
So, why is Section 21 so contested?
One of the major issues that have fuelled these concerns is the extended duration it takes for courts to process possession claims.
According to the National Residential Landlords Association (NRLA), it can take well over six months for a case to be addressed. This extended timeline means that landlords who have legitimate reasons for wanting to regain possession, such as non-payment of rent or antisocial behaviour, often face long periods of uncertainty and financial strain.
The courts have already been dealing with a backlog of cases, which has been exacerbated by various factors, including the COVID-19 pandemic. This backlog further extends the processing times, leaving many landlords waiting for an extended period before they can regain control of their properties.
Court processing can also have significant financial implications for landlords. During the period when a tenant is in arrears or engaging in antisocial behaviour, landlords may not receive rental income, and they may incur legal costs. Lengthy court processes can exacerbate these financial burdens. All of these factors could deter new landlords renting properties out to tenants, in a market short of rental properties.
The National Residential Landlords Association (NRLA) is among the organisations that have actively voiced their concerns. Arguing that without swift court reforms, the abolition of Section 21 might inadvertently drive responsible landlords away from the rental market. This situation is particularly worrisome at a time when renters are already grappling with the challenge of finding suitable places to live.
The Government’s Pledge to Court Improvements
In response to a report from the House of Commons Housing Select Committee, the government has made a firm commitment. They have pledged not to abolish Section 21 until they have witnessed significant progress in improving the court system. This means that the government is determined to ensure that the court reforms are in place before they proceed with the abolition of Section 21.
But what would Court Improvements look like?
Ben Beadle, the CEO of the NRLA, said: “Reform of the rental market will only work if it has the confidence of responsible landlords every bit as much as tenants. This is especially important given the rental housing supply crisis renters now face.’
Downing Street has not yet specified a timeline for achieving the reforms, but what is important to note, is that Section 21 will not be scrapped until the courts see significant improvement
Protecting the Student Housing Market
In addition to court reforms, the government is addressing the specific needs of the student housing market. They have promised to introduce a new ground for possession. This ground is tailored to accommodate the yearly cycle of short-term student tenancies, enabling students to secure accommodation in advance, ensuring they have a place to live in the following year.
In conclusion, the government’s commitment to improving the courts before scrapping Section 21, is a significant step towards balancing the interests of landlords and tenants. By addressing the issues in the court system, it aims to ensure that responsible landlords remain active in the market. Simultaneously, the pledge to protect the student housing market reflects the government’s broader vision for an inclusive and efficient rental market.
These measures are essential not only to uphold the rights of landlords and tenants but also to ensure that the rental market remains dynamic and accessible for all parties involved.