It was acceptable in the 80s - But why do we still not understand S21?

S21 not a real eviction

 In 1988 a new Housing Act gave us what we know today as an Assured Shorthold tenancy or AST and created the provision of Section 21 notices, this provides the opportunity for landlords to evict  tenants from the property even if the tenant has not breached the terms of the tenancy agreement.

 

Commonly referred to as The No Fault Notice, S21 became the go-to notice of choice for landlords and provided a much simpler way to remove a tenant from a property, requiring a notice of 2 months and then a court order.

Prior to January 1989, landlords could serve a Notice to Quit under the Rent Act 1977 but would be required to prove one of the 20 Cases ( we would now refer to as grounds) had been breached in order for the court to award the possession.

 

The S21 did not require the landlord to wait for the tenant to make a mistake or default on rent payments.

In addition  Section 21 of the Housing Act guaranteed the landlord would get the eviction by making the no fault notice a mandatory ground, meaning a judge had no option but to award the requested eviction.

 

At the time, this was a revelation for landlords who had previously only had  protected and statutory tenancies to issue to tenants who in turn had the right to stay in a property they were renting, almost indefinitely and could even pass it on to relatives in the event of their death.

The Tory Government at the time saw that this system was disincentivising homeowners to let out their properties, contributing to a housing shortage.

The private rental sector, at this time, accounted for only 8% of homes, stark contrast to 1918 where 78% of housing was privately rented.

 

But over 30 years on from this landmark change in legislation, how many landlords and letting agents alike truly understand the meaning and use of Section 21?

 

The most common misconception is that a S21 notice is in fact an eviction warrant and tenants are expected to vacate once the notice expires.

Many landlords will gamble the completion date for the sale of a house on the expiration of a section 21, more often than not losing the sale when the tenant stays put.

 

As will any business, it is as important to understand how to end a contract as it is to enter one.

 

Key Points of a Section 21

 

It is NOT an eviction warrant – A S21 is merely an informative letter set out in a prescribed format, advising the tenant that once from the end date of the letter a landlord may apply to court for a possession order.

Tenants do no have any legal reason to leave when a S21 expires – A tenancy can only be ended by the tenant ( Notice to quit) or a Court. When the S21 expires, that is simply the next step date for when a landlord can apply to court for possession.

Tenants do not have to leave.

Possession order if NOT an eviction – Once a court has granted the possession order for the property, this commonly gives a tenant 14 days to vacate the property, HOWEVER, from a legal stand point the tenant still does not have to leave the property.

Only an eviction warrant – Tenants only have to legally vacate a property once a bailiff attends and carries out the eviction, at this point changing the locks and handing the keys, the possession, back to the landlord.

 

It is important to remember that although a S21 carries less admin to issue than a S8, its process can actually take longer and be more costly, as rent arrears cannot be claimed when using a S21 because this is a NO FAULT eviction, meaning a separate claim for arrears will need to be submitted at additional costs.

 

With so much additional regulation surrounding how and when a S21 is served and its validity so easily forfeited

It is extremely important that landlords and agents understand the basic laws of renting privately and look at the practical more cost effective and swifter options available other than S21.