The Labour Party’s manifesto promises to overhaul the private rental sector by immediately abolishing Section 21 (or “No Fault”) evictions, and implementing other reforms to “prevent renters being exploited and discriminated against, … and take steps to decisively raise standards”
The manifesto states:
“Security … means having a secure roof over your head. That is not the case for too many renting their homes privately. Labour will legislate where the Conservatives have failed, overhauling the regulation of the private rented sector. We will immediately abolish Section 21 ‘no fault’ evictions, prevent private renters being exploited and discriminated against, empower them to challenge unreasonable rent increases, and take steps to decisively raise standards, including extending ‘Awaab’s Law’ to the private sector.”
The Renters Reform Bill, which was published under the previous government on 16 June 2022, sought to abolish ‘no fault’ evictions and deliver a simpler, more secure tenancy structure. However, the Bill has yet to be passed by Parliament. It is unclear whether Labour intend to pass the Bill in its current form, or whether changes will be made before it is passed.
The current legislation for section 21 notices is lengthy and complex. Section 21 notices are also known as ‘no fault’ evictions because notice can be served on tenants without the landlord having to provide a reason for demanding possession of the property. The section 21 process differs from section 8 which requires the landlord to prove one or more of the grounds set out in Schedule 2 of the Housing Act 1988, such as non-payment of rent.
How will the abolishment of Section 21 evictions affect landlords?
Under the current version of the Bill, the grounds a landlord must prove to serve a section 8 notice will be expanded to accommodate the loss of section 21 notices. For instance, some of the proposed new grounds for the use of a section 8 notice include instances where the landlord intends to sell the property and where close family members of a landlord intend to move into the property.
Further, under the current Bill a landlord will still be able to serve notice on the tenants in circumstances where there are rent arrears or repeated rent arrears, breach of contract, nuisance, and anti-social behavior, amongst the other grounds set out in Schedule 2.
As such, despite the likely abolition of section 21 notices, the proposed changes to section 8 notices will provide most landlords with a usable alternative to obtaining possession of their property back from tenants, albeit, via a different route than the currently available section 21.
Although the Labour Party has promised to abolish section 21 notices imminently, it is likely that a transitional period will be implemented to allow any existing section 21 notices and/or court proceedings relating to section 21 notices to continue.
Changes to rent increases
In addition to abolishing ‘no fault’ evictions, Labour’s manifesto proposes to empower tenants to challenge unreasonable rent increases. Again, whilst it is unclear whether the draft Bill will be amended prior to being passed, the current version of the Bill proposes to:
- Strengthen tenants’ ability to challenge unreasonable rent rises by allowing tenants to make an application to the property tribunal for a determination on the appropriate rate;
- Abolish rent review clauses in tenancy agreements;
- Limit rent increases to once per year; and
- Require at least two months’ notice of any proposed rent increase.
How Talbots Law can help…
If you are a landlord and you are concerned about the proposed changes and wish to discuss further how this may affect you, please do not hesitate to get in touch with one of our Landlord and Tenant specialists who will be happy to assist. It is prudent to act now to avoid being caught out.
For more information or advice on this or any other Landlord and Tenant Disputes, please call our Dispute Resolution Department on 0800 118 1500 or read more by clicking here.
DISCLAIMER: The contents of this blog or any other published by Talbots Law cannot be considered as legal advice and should therefore not be acted on without prior consultation with a qualified solicitor or legal professional.