Abolition of Section 21…..Private rented Armageddon?

The Government are currently seeking consultation on their  decision to remove section 21 notices from the eviction  process and this has created waves of panic across the industry, with the media having us believe landlords are evicting tenants on mass for fear they will never be able to get their property back once the law comes into force.
But what does it really mean for landlords, will your property be lost to your tenant forever?

Until the Bill is produce after the consultation period we will not know for sure what the new regulations will be, but what we do know is no fault eviction notices will be no more, this will mean Assured shorthold tenancies (AST) will be no more and as a knock on effect deposit protection regulations, technically, will be no more as landlords only need to protect a deposit for an AST

To give us the best indication of how this shake up will effect the private rented sector as we know it, we don’t have to look far. In 2017 Scotland went through a similar change, removing no fault notices and streamlining their private rental industry with the introduction of the  Private Residential Tenancy (Private Housing (Tenancies) (Scotland) Act 2016

Any tenancy that started on or after 1 December 2017 will be a private residential tenancy. This new tenancy replaces  the assured and short assured tenancy and provided the filling changes:

No fixed terms - private residential tenancies are open ended, meaning a  landlord can't ask a tenant to leave just because they have  been in the property for 6 months as they can with a short assured tenancy.
Rent increases – Rent can only be increased once every 12 months and if the tenant thinks the proposed increase is unfair they  can refer it to a rent officer. – It is the same in England, if a tenant believes a rent increase is too high they can appeal to the rent tribunal
Longer notice period - if your tenant has  lived in the  property for longer than 6 months you will have to give you at least 84 days notice to leave (unless they have broken a term in the tenancy).
Simpler notices - the notice to quit process was scrapped and replaced by a simpler notice to leave process.
Model tenancy agreement - the Scottish Government published a model private residential tenancy that can be used by landlords to set up a tenancy.
If a  tenancy started before 1 December 2017 it will continue as normal until tenant or  landlord bring it to an end following the correct procedure.
If renewed then a new tenancy this will be a private residential tenancy.

Deposits
Scotland operate a deposit protection scheme similar to England, the difference is all deposits must be protected in one of the 3 government approved schemes and if the deposit is not registered a tenant can complain to the First-tier Tribunal for Scotland, and the tribunal can order the landlord to pay you up to three times the amount of the deposit paid. Tenants  can only  do this up to three months after the tenancy has ended.

Giving notice
If a tenant wishes to vacate and they have a private residential tenancy tenant, then this is normally 28 days’ notice.

Evictions
A landlord will need to give a tenant  either 28 or 84 day’s notice that they intend to apply for an eviction notice. The period of notice will depend on how long the tenant has been in the property and which ground their are applying for eviction. The form a landlord needs to use is called a ‘notice to leave’.

If the tenant is still in the property after the notice period is over, then the landlord will have to apply to the Housing and Property Chamber of the First Tier Tribunal for an eviction order.
The notice to leave is valid for 6 months, if no application for an eviction order is made, then another notice to leave would need to be issued.
If a tenant does not leave on the expiry of the Notice to leave, then the landlord must apply to First Tier Tribunal for an eviction
The landlord must also serve the local authority with a notice advising of the potential eviction.

What are the grounds?

There are 18 grounds for possession that a landlord can use to apply for an eviction order.
The grounds are divided into 4 areas:

• the property is required for another purpose,
• the status of the tenant,
• conduct of the tenant,
• there is a legal reason why the tenancy can't continue.

There are 10 mandatory grounds, where the tribunal has no discretion to refuse the eviction if the ground is proved, and 8 discretionary grounds, where the tribunal should consider whether it is reasonable to grant an eviction order.

The property is required for another purpose
• Ground 1: Landlord intends to sell
• Ground 2: Property to be sold by lender
• Ground 3: Landlord intends to refurbish
• Ground 4: Landlord intends to live in the property
• Ground 5: Family member intends to live in the property
• Ground 6: Landlord intends to use for non-residential purposes
• Ground 7: Property required for religious purposes
Tenant's status
• Ground 8: not an employee – tied accommodation
• Ground 9: No longer in need of supported accommodation
Conduct grounds
• Ground 10: Not occupying let property
• Ground 11: Breach of tenancy agreement
• Ground 12: Rent arrears
• Ground 13: Criminal behaviour
• Ground 14: Anti-social behaviour
• Ground 15: Association with person who has relevant conviction or engaged in relevant anti-social behaviour
Legal impediment to the let continuing
• Ground 16: Landlord has ceased to be registered
• Ground 17: HMO license has been revoked
• Ground 18: Overcrowding statutory notice

From 1 December 2017, most types of legal applications about private sector tenancies are dealt with by the Housing and Property Chamber, rather than the Sheriff Court, this removed a lot of pressure from the courts and not only streamlined the eviction process but also sped up the time it takes to evict a tenant from a property.

So while we wait to see how the new legislation will be presented, it is worth taking a calming deep breath to know that the lack of a S21 will not bring private rental Armageddon and landlords will still be able to gain possession of their properties.
Because let’s face it, a Landlord has never served a S21 for no reason, all the new rules will mean is that you will now have to state your reason and match the ground to it.