End to No Fault Evictions

Shilpa Mathuradas

Everything you need to know about section 21 reform

The government is planning to overhaul renter’s rights in the UK, leaving landlords and tenants with a lot to think about.

One of the biggest reforms concerns no-fault eviction under Section 21 of the Housing Act 1988, which allows landlords to take back possession of a rental property on giving two months’ notice.

This article delves into the government’s proposed changes to no-fault evictions and their potential effects on landlords and tenants.

What is a section 21 no fault eviction?

Section 21 of the Housing Act 1988 permits landlords to regain possession of their properties without having to give any reason, once the fixed term of the tenancy has expired.

It applies to properties leased under assured shorthold tenancies, which is the most popular type of private rental agreement in the UK.

When using section 21 to evict tenants, the main obligation is to give the tenant at least two months’ notice to move out, so they can find another place to live.

In addition, there are lots of procedural steps for the landlord to follow before serving a notice. Section 21 evictions are technically tricky to get right. The rules are designed to protect tenants from unlawful or retaliatory eviction, for example, where the landlord evicts the tenant to avoid dealing with a legitimate repair request.

Section 21 is known as ‘no fault’ eviction because the landlord doesn’t have to prove that the tenant has done something wrong.

Why is no-fault eviction being reformed?

From a landlord’s point of view, section 21 offers a faster and simpler way to get their property back. If a landlord wants to renovate a property, sell it, or simply end a relationship with a difficult tenant, section 21 allows them to evict without needing to provide evidence or go through a lengthy legal process.

On the other hand, section 21 has been criticised for tilting the balance of power towards landlords. The no-fault process leaves tenants very little scope to resist the eviction. Unless there has been a procedural mistake, such as failing to protect the tenant’s security deposit, then the court must grant an order for possession.

The Renter’s Reform Bill sides with the tenant’s interests and proposes to remove section 21 from the Housing Act. When this happens, it will be illegal for landlords to evict tenants without providing a valid reason.

What does an end to no-fault eviction mean for landlords?

For landlords, the removal of section 21 would be a significant change—but perhaps not the seismic shift that many landlords fear.

Landlords will still be able to regain possession of their property under Section 8 of the Housing Act 1988. Section 8 allows landlords to evict a tenant based on specific reasons, whether for breaching the terms of a tenancy agreement or other reasons, such as the landlord wanting to sell the property or use it for a family member.

The government plans to expand what amounts to a good reason to evict, potentially making it easier for landlords to use section 8.

At the moment, we have a situation where landlords cannot claim rent arrears through the accelerated section 21 procedure (they can through section 8). However, landlords often make a commercial decision to evict ‘problem’ tenants via section 21 to secure possession of the property, and begin a separate money claim where arrears are outstanding, rather than using the potentially more challenging fault-based eviction process.

So, in practice, most section 21 evictions are already being carried out on the basis of some fault or breach by the tenant. The abolition of section 21 simply means the landlord will have to work harder to prove its case.

We expect that landlords will be more cautious in their tenant screening processes as a result.

How will tenants benefit?

The government hopes that the abolition of no-fault evictions will make it easier for tenants to establish long-term housing without living under the constant threat of eviction.

It has also been suggested that the new rules, if passed, will encourage more scrupulous landlords into the market.

Are there any downsides to removing no-fault evictions?

One worry is that an increase in factual disputes about the reasons for evictions will put strain on the court system.

Shilpa Mathuradas, head of property litigation here at Osbornes Law, points out that, despite publicity about rogue landlords seeking to evict tenants for no good reason, they represent a tiny minority of property owners. Research conducted by the Residential Landlord Association found that 84% of landlords who had used the Section 21 process did so because of tenant arrears, and 56% because of the damage to property and antisocial behaviour.

When section 21 goes, all these cases will need to be dealt with under section 8. As Shilpa says, “If a landlord is rightfully claiming possession based on rent arrears or any other fault of the tenant, this is not going to stop because the Section 21 process is abolished. Landlords will simply pursue the tenants through the more expensive and lengthier Section 8 process. This will not create stability and security for the tenant.”

For landlords relying on section 8, there is a possibility for the tenant to pay down arrears just enough to avoid a Possession Order. It is not yet clear what the court’s attitude to this will be: will the landlord have to start section 8 proceedings all over again if the tenant falls back into arrears, or will a persistent pattern of late or insufficient rent payment be sufficient grounds for eviction? Either way, finding the answer is likely to involve work for our overstretched county courts.

How can we help?

In light of the proposed changes to Section 21, now is a good time for both landlords and tenants to understand their rights and obligations under tenancy agreements. Our expert team is on hand to help you make sense of the reforms. Whether you’re concerned about a difficult tenant relationship, worry a landlord may seek to sell up before no-fault eviction is abolished, or you simply want to ensure that your property is let as smoothly and appropriately as possible from the outset, we can help.

To speak with one of our solicitors, contact us by:

• Filling in our online enquiry form; or
• Calling us on 020 7485 8811