If Section 21 Is Abolished, What Will This Mean For Landlords?

In May, the Government’s plans to abolish Section 21 as part of the Renters (Reform) Bill were presented to Parliament. Below, we look at the implication for landlords:  

What Is Section 21?

A Section 21 notice is given by the landlord to ask their tenant to leave an assured shorthold tenancy, generally with two months’ notice. It allows them to repossess the property and is an important right of the landlord. No reason has to be given for the eviction so it’s sometimes also known as a no-fault eviction notice, since a tenant might be asked to leave simply because the landlord wants to move back in.

Why Is The Government Abolishing Section 21?

The abolishment of Section 21 comes as part of the Renters (Reform) Bill – an overhaul of private rentals in England aimed at providing greater security for tenants, as well as easier solutions for landlords of problematic tenants. The Government has stated that its intention is to level the playing field between landlord and tenant with the changes. As Section 21 is abolished Section 8 – which is used is they have broken the terms of the tenancy – will be strengthened, to give landlords more power to recover their property.

How Will Section 8 Be Strengthened?

Section 8 of the Housing Act 1988 will be strengthened to compensate for the loss of section 21. However, apart from where terms have been broken, the reasons for eviction will be more limited. Providing the tenant has lived in your property for six months you will be able to evict the tenant under ‘reasonable’ circumstances. Essentially these include: redevelopment, a desire to sell the property or a close family member moving in or renting the property.

What Is The Likely Timescale For The Abolishment of Section 21?

The timescale is still not confirmed since the Renters (Reform) Bill has to pass through Parliament first, a process that can take around a year. The Bill was presented to parliament on 17 May 2023 and will now be considered by MPs and debated at a Second Reading. Housing Secretary Michael Gove has been quoted as saying he wants to see the new Bill in place “as quickly as possible”.

How Will It Affect Me?

The change is significant for landlords and in a Mortgages for Business survey in March a third of landlords said that its scrapping was of major concern to them. Previously you could evict tenants without reason – a no-fault eviction – and they had to move out within two months. With the abolishment of Section 21, there is a greater security for tenants and a rebalancing of power between landlord and tenant.

What Can I Do To Prepare?

While the Bill is up for debate and consideration in Parliament there’s not much that landlords can do to prepare. There’s also the possibility that the proposed changes will alter further as the Bill evolves. Until Section 21 is abolished you should continue to protect your landlord rights through Section 21, by ensuring you have ticked all the relevant boxes with your tenancies. With over 170 Acts and Regulations to consider this can be tough so our Landlord Compliance Checklist is a useful guide. For HMO landlords, our 7 Step HMO Strategy will help.