Urban Myth – that section 21 is always bad for tenants

urban mythIt is a truth ‘universally acknowledged’ that section 21 is bad for tenants and, therefore, should go.  Shelter has said so.  The CAB has said so.  All the political parties have said so.

But is that correct?  Is it ALWAYS bad for tenants?

It is part of the political mood just now that section 21 is evil and should be removed.

But then it was the political mood in 2016 that membership of the EU was bad and should be go, and look what happened to that.  Clearly, the benefits of Brexit have not been as promised.

The fact that ‘everyone thinks’ something does not necessarily mean that ‘everyone’ is right.

So will removing Section 21 bring untold benefits to tenants?  Or, indeed, any benefits? Is it the answer that will solve our rented housing problems?

Clearly, it will solve some current issues.

  • Landlords will have to give a reason when evicting tenants
  • Rogue landlords will not be able to routinely evict tenants who demand their legal rights
  • Therefore tenants will (it is hoped) have a greater long-term security

However, it will also bring other problems in its wake which some may not have considered.  Let’s take a look at them.

Enforcement of standards

There are a number of ‘pre-requisites’, which include compliance with various health and safety and other tenant protection legislation, which landlords must comply with as a condition of using section 21.  For example:

  • Landlords must have obtained and served a gas safety certificate before the tenants move in
  • Tenants must have been given a valid energy performance certificate
  • If a deposit has been taken, landlords must have protected it and served ‘prescribed information’ within 30 days
  • If the property is a licensable HMO, the landlord must have obtained an HMO license from the Council
  • If illegal tenant fees have been charged, they must have been refunded
  • The landlord must have served the government ‘How to Rent’ booklet informing them of their rights
  • No eviction can take place within 6 months of the Council serving an improvement notice

The fact that section 21 is only available after compliance with these rules is a big factor influencing landlords’ compliance with said rules.

The grounds for possession that will apply if section 21 is removed are not conditional upon these rules in the same way.  Tenants can usually defend if their rights are not upheld, but this will often lead to a stressful and time-consuming court claim.  It will not prevent the landlord from bringing a claim at all, as is the case with section 21.

Help for tenants requiring council re-housing

It’s not often realised that many claims for possession under section 21 are brought at the tenants’ request.

This happens when tenants want to be rehoused by the Local Authority, but the Local Authority refuse while they have an existing home.  Even if this home is no longer suitable for them, e.g. if it is too expensive.

But if the tenants move out of their rented home, Local Authorities will then often refuse to rehouse them on the basis that they are ‘voluntarily homeless’.  Meaning that they should have stayed where they were until evicted.  Even though that property was unsuitable for them.

When I did eviction, work a substantial number of claims were brought simply to force Local Authorities to rehouse their tenants.  As the claims were brought under section 21 Local Authorities could not claim that the tenants were voluntarily homeless – because the eviction was not based on the tenants’ fault (as for example it would be if they were evicted for rent arrears).  Because section 21 is a ‘no fault’ ground.

If section 21 goes and landlords have to give a reason for the eviction, this will in many cases be based on rent arrears, and this may give Local Authorities grounds to refuse to rehouse.

I know they are not supposed to do this, but everyone knows that they do.  Often they have no choice due to the massive shortage of Local Authority accommodation available for rehousing.

The effect of eviction under ‘bad tenant’ grounds

The fact that a tenant is evicted under one of the ‘bad tenant’ grounds (most commonly rent arrears) will not only hamper tenants obtaining Local Authority housing.  It will also put off landlords in the private sector.

Most landlords will use section 21 if they can, as it is quicker and more straightforward (and therefore cheaper).  The result of this is that we don’t really know for sure (other than anecdotally) what the main reasons for evictions are.

Once section 21 is unavailable, it will not stop landlords from evicting tenants.  However, it will then become apparent what the main reasons for eviction are.  This is bad news for the tenants being evicted – as they will find it far harder to find alternative accommodation.

This may well be good for landlords, though – as bad tenants will find it less easy to hide their previous bad behaviour.

The problem of anti-social behaviour

One big reason why landlords use section 21, again often at the request of tenants, is to remove a co-tenant or neighbour who is behaving in an anti-social manner.

It is well known that anti-social tenants can cause huge misery to others.  Section 21 is the only way that they can be removed relatively quickly.

After the loss of section 21, landlords will have to prove the anti-social behaviour in court.  Which carries a number of big problems:

  • The tenants will be incentivised to defend to ‘clear their name’ – something which is not a problem with section 21, where no reason is given
  • If they defend, it will take much longer to obtain a possession order as there will, in many cases, need to be a trial.  It could take over a year, during which the misery for neighbours will continue
  • It will be a much more expensive claim for the landlord to bring, which may discourage some landlords from doing this.  After all, they are not normally personally affected as they live elsewhere
  • Other tenants may have to give evidence in court to prove the anti-social behaviour.  Which they may be unwilling to do, fearing reprisals from the anti-social tenant (who are often very unpleasant people)

I see the problem of evicting anti-social tenants as being the biggest issue raised by the removal of section 21.  There needs to be major improvements in our court system – something unlikely to happen any time soon.

And finally

I do understand why tenants and tenant organisations are so unhappy with Section 21.  However, the real problem is a lack of available properties to rent.

If we had an ample supply of rented properties, then it would be easy for tenants faced with eviction to find alternative accommodation.  Tenants would also be able to avoid those bad landlords who evict tenants for claiming their rights.

There is also the fact that landlords need to feel that they can recover possession of their property if necessary.  As I explain here, the private rented sector probably would not exist at all in its current state if section 21 had not been introduced in the late 1980’s.

If landlords are worried that they will lose all control (as happened under the 1977 Rent Acts) they may sell up, reducing the available pool of accommodation.  This would be a disaster – not for the landlords but for tenants, and will push up rents.  It is something which is already starting to happen.

In my opinion, the best solution to the housing problems is a major expansion of public sector housing building, ideally using modular building methods with high environmental standards.  That will benefit tenants generally far more than the removal of section 21.

But what do you think?

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