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Section 21 Abolition

With all the changes within the property industry, we ask:

… should the abolition of Section 21 be seen as a threat or an opportunity?

What a DYNAMIC industry we work in!

There is one question. Has the housing market in the UK been so bad for so long that it needs reforming in nearly all avenues all at once? Let’s just look at what is in the tubes now.

I’m sure, from a Landlord’s perspective, it can’t be the pending licensing legislation? NOOO. Not even the abolition of Mortgage Interest Relief, the dreaded Section 24? NOOO. It must surely be the changes to the Housing Act 1988 and the abolition of no-fault evictions.

Abolition of Section 21!

Why is the industry is up in arms? The Government announced, on 15 April 2019, planned changes to the eviction process and the launch of the consultation process. Due to the tax changes, there is already a shortage of supply from the mad exodus of Landlords from the PRS.

The proposal is to:

  • Abolish the Section 21 route to gain possession and bolster the Section 8 route.
  • Introduce Housing tribunals in the event of proceedings, instead of the County Courts, making it quicker and cheaper to gain possession in a proven case.

Currently, rent must be two months (eight weeks) in arrears as at the Notice and at the time of the court appearance. Many people manipulate this by bringing the debt £1 under the eight weeks at the hearing. The case can fail. It is proposed NO MORE.

After the abolition, the rent need only be four weeks in arrears when action can be issued. If proven, possession will be granted. It is further proposed that neither party need have representation. For example, an agent should be able to act on the Landlord’s behalf in a tribunal, whereas in the Courts they are not.

There will also be a lot more negotiating in a tribunal, allowing all sides to argue their point. Of course, that should also have been the case in the County Courts. However, for those of us who have experienced it, we know that never happens.

So why do all this?

It is argued “to make a better, more secure, long term place for people to live, settle and put down roots.” As a long-time Landlord, I fully support this daydream as I am sure all sane Landlords do. But is it? Maybe this abolition should be viewed as an opportunity rather than a threat? David Alexandra, MD of a leading Scottish agency, explains the Scottish experience.

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