Introduction
The Renters Reform Bill was finally introduced to Parliament on the 17th of May 2023 by the House of Commons (HOC), having first been promised in the Conservative’s 2019 manifesto by Boris Johnson.1 Currently at the HOC report stage, the bill was initially introduced in an effort to “bring in a better deal for renters”,2 with the final objective of delivering “a fairer, more secure, and higher quality private rented sector for both tenants and landlords”.3 The reforms are expected to have a very significant impact
considering that there are approximately “4.6 million households within the private rented sector; representing 19% of all households in England”4 as well as the “2.3 million landlords in England”.5 Key focuses, that the reforms hope to tackle, include helping the rental sector become more welcoming to tenants who currently feel that they “cannot put down roots in their communities or hold down stable employment”6 as a result of uncertainty towards their housing situation. Additionally, is the hope to reduce the negative impact on children, reported to have “worse educational outcomes, reduced levels of teacher commitment and more disrupted friendship groups than other children”,7 due to insecure housing environments. With a 2019 survey citing that more than half (54%) of landlords have been involved in a dispute with their tenants at least once, and nearly a fifth having had disagreements with their tenants at least once a year,8there is certainly a large scope for improvement in the rental market and the renting system, with the proposed reforms potentially fixing, or at least minimising, issues within it.
However, a recent matter of some contention has been whether any enacted reforms will actually meet these objectives, and whether they do so effectively. Whilst the reform bill covers a great number of details, only the main reforms surrounding Section 21 of the Housing Act 1988 will be analysed in this article. The aim is to explain what these main reforms are, their implications for landlords and tenants, and how they will meet the government’s overarching objectives for improving the rental sector, or otherwise, what the adverse effects of legislating these objectives may be.
Supporting renters? – Abolishing Section 21 ‘no fault evictions’
The headline change proposed by the reform bill is the abolishment of Section 21 ‘no fault evictions’, pursuant to the 1988 Housing Act.9 This Section legislates the terms by which landlords may evict tenants anytime beyond the assured shorthold tenancy period- provided a two-month written notice has been given prior to the date of eviction. Certainly being the most popular method of eviction, this reform serves to improve the current situation in which court proceedings for no-fault evictions in England have reached their highest level in six years, with 7,491 no-fault eviction claims brought before the courts between April and June of this year alone.10
By abolishing Section 21, and alongside this the majority of assured tenancies, landlords would be restricted from evicting a tenant unless they are able to supply a reasonable circumstance such as anti social behaviour grounds, rent arrears, or damage to the property, which would be provisioned for in the legislation. This reform could have many positive effects like reducing the current 50% rise in the number of households at risk of homelessness in England, as a direct result of Section 21 evictions. It can also help improve the livelihood of the 11 million people who rent from private landlords in England by giving them more stability and assurance, with greater relative control, over their circumstances.
Alongside this reform is another to limit the number of increases in rent that a landlord can make: set to be once a year, with the expressed intention to “provide stronger protections against backdoor eviction, by ensuring tenants are able to appeal excessively above-market rents which are purely designed to force them out.”11 This is particularly relevant with regards to The Office for National Statistics’ rent index, which, in September 2023, recorded the highest rates of rent inflation, since the data collection series began in 2006.12 With greater confidence as to the affordability for renters, the market will likely, as a result, have an increase in demand. On the other hand, considering the aforementioned restrictions to be imposed on grounds for evicting tenants, the renting market may decline due to a lack of supply. This is evidenced by a Lettings Industry Survey in 2022, which reported that 29% of agents and 54% of landlords cited the scrapping of Section 21 as the main reason why landlords would choose to leave the renting market.13 A shrink in the already strained renting market may have serious negative consequences for renters, especially for the large percentage who cannot afford to buy a house, exacerbated further by the current cost of living crisis.
Favouring landlords? - Reforming possession grounds
Another key argument to raise is that the abolishment of Section 21 is not a complete ‘removal’ of the eviction route, as the action to abolish Section 21 will be countered largely by Section 8 of the Housing Act 1988 (‘notice of proceedings for possession’) which is to be expanded and liberalised in response. This expansion is to be carried out to provide further substantive grounds for possession, other than those already contained in Schedule 2 of the Housing Act, which landlords may use. This important liberalisation will include amending Ground 1 (a mandatory ground for possession if the landlord requires the property for themselves) and the new Ground 1A (governing the selling of rented property), which currently may only be relied upon if included in the terms of the tenancy agreement; though this is also liable to change and become available grounds to landlords regardless of its inclusion in tenancy agreements.
What is considered controversial- and extremely so to the specialists and renters’ campaign group ‘Generation Rent’, is the current lack of clarity14 regarding the expansion of these substantive grounds. The concern especially regards the viable route of selling houses within Ground 1A which would allow landlords to sell with ‘vacant possession’ and derive the benefits of having a larger market, whilst not incurring a 20% discount on the open market by selling with ‘tenants in situ’.15 In comparison, a landlord under current law who would like to move back into his property but neglected to include a provision for Ground 1 in the tenancy agreement, or a landlord who wishes to sell their property with vacant possession, can only rely upon Section 21 to evict their tenant if the Section’s terms allow them to. However, compliance with the many regulations required for a Section 21 notice is not always straightforward. In cases where a landlord has breached any of their obligations to their tenants and is unable to rely on Section 21 at all, the landlord may be left only with the option of bribing their tenants away, otherwise known as a pay-off, which is currently a path followed in roughly 5% of eviction cases.16
As such, an abolishment of Section 21 may not rid landlords of the power to evict a tenant at their own discretion and may not be as significant of a change as it seems. Furthermore, Section 8 does not carry the same restrictions as Section 21 does, and discussion has been drawn heavily around the contents of the extended grounds of evictions, which so far includes terms like “irresponsible behaviour”, which may be seen as broader in nature. As observed by Daniel Bacon, writing for ‘The New Law Journal’: “The liberalisation of Sch 2 no-fault grounds–the amendment and insertion of Grounds 1 and 1A respectively—will therefore greatly strengthen the hand of a landlord who is looking to sell a property with vacant possession or to move themselves or their family in.” This is because there has been a lack of defined evidential burdens to meet. A simple assertion of “intending to sell or intending to move in may be sufficient” to satisfy these mandatory grounds and evict tenants with even greater ease than the original Section 21 provided.
The House of Commons has yet to approve the bill to the House of Lords, so some of these vague details may (hopefully) change. Whether or not the law is on the tenants’ side due to the abolishment of Section 21 and simultaneous creation of grounds of eviction tied to Section 8 of the Housing Act, may be a question for tenants to decide individually based on their circumstances. In consideration, there have also been more administrative reforms in the works, aimed at helping to improve the renting system and efficiency of the courts. This may, in turn, significantly reduce the time and money spent on cases, as well as encourage perhaps disheartened tenants to speak up, supported by more accessible legal advice.
Conclusion
Whilst the government states that their intentions to enact rental reforms are to protect renters’ rights within the reform act, there is also action to strengthen the rights of landlords and their grounds of possession. Namely, by clarifying the terms by which landlords may recover and repossess their properties. The second reading debate of the bill on the 23rd of October led to the abolition of Section 21 being delayed until the implementation of another reform for the improvements of the courts towards greater efficiency. A great number of Parliamentary members who stated their declaration of interest
(as landlords themselves) havealso speculatedthis as a reason for the difficulty in handling the abolition of Section 21. Particularly since Section 21’s procedures are what landlords are used to and have largely defaulted to for evicting tenants to date. However, this delay may somewhat be justified by the reasoning that removing a landlord’s flexibility to terminate tenancy agreements, without needing a reason (‘no-fault evictions’), would likely result in an influx of orders for possession under Section 8, which the courts may not be able to manage without improvements.17
Thus, removing Section 21 may be favourable to tenants who were insecure about their ability to settle, but this is largely reliant on the level of reform unto Section 8 and its provision of different grounds for eviction. Considering the bill has yet to be enacted, amendments may still be made, however, some reform is at least promised in the near future.
References
[1] The Conservative and Unionist Party, ‘Conservative Party Manifesto 2019’. (24 November 2019) 29. <https://www.conservatives.com/our-plan/conservative-party-manifesto-2019> accessed 25th October 2023 “We will bring in a Better Deal for Renters, including abolishing ‘no fault’ evictions and only requiring one ‘lifetime’ deposit which moves with the tenant. This will create a fairer rental market: if you’re a tenant, you will be protected from revenge evictions and rogue landlords, and if you’re one of the many good landlords, we will strengthen your rights of possession.”
[2] Department for Levelling Up, Housing and Communities. ‘Guide to the Renters (Reform) Bill’. (Gov.uk, 17 May 2023). <https://www.gov.uk/guidance/guide-to-the-renters-reform-bill> accessed 23rd October 2023.
[3] Department for Levelling Up, Housing and Communities. ‘Renters (Reform) Bill’. (Gov.uk, 17 May 2023). <https://www.gov.uk/government/collections/renters-reform-bill> accessed 23rd October 2023.
[4] Department for Levelling Up, Housing and Communities. ‘English Housing Survey 2021 to 2022: Private Rented Sector’. (Gov.uk, 13 July 2023). <https://www.gov.uk/government/statistics/english-housing-survey-2021-to-2022- private-rented-sector/english-housing-survey-2021-to-2022-private-rented-sector> accessed 25th October 2023,
[5] ibid 2.
[6] Kristine von Simson and Janis Umblijs, ‘Housing Conditions and Children’s School Results: Evidence from Norwegian Register Data: Moving Always Report’ (2021) 21(3) International Journal of Housing Policy 346, 346- 371. <https://doi.org/10.1080/19491247.2020.1814190> accessed 27th October 2023.
[7] ibid.
[8] LV= General Insurance, ‘Share of Landlord-Tenant Disagreements in the United Kingdom (UK) in 2019, by Frequency’. (LV=, January 2020). <https://www.lv.com/home-insurance/landlord-insurance/uk-landlord-report 2019> accessed 27th October 2023.
[9] Housing Act 1988.
[10] Michael, Goodier. ‘No-fault Eviction Proceedings Hit Highest Level for Six Years in England’. The Guardian. (London, 10 August 2023). <https://www.theguardian.com/money/2023/aug/10/no-fault-eviction-proceedings highest-six-years-england> accessed: 27th October 2023.
[11] ibid 2.
[12] Generation Rent, ‘The Renters Reform Bill’. (Generation Rent, 21 October 2023).
<https://www.generationrent.org/2023/10/21/the-renters-reform-bill-common-questions/> accessed 29th October 2023.
[13] Goodlord’s Newsagent, ‘How Have Plans to Abolish Section 21 Changed the Lettings Sector?’ (Tenancy Deposit Scheme, 2022). <https://www.tenancydepositscheme.com/how-have-plans-to-abolish-Section-21- changed-the-lettings-sector/> accessed 02nd November 2023.
[14] Conor O’Shea. ‘The Renter’s Reform Bill: Our Verdict’. (Generation Rent, 19 May 2023). <https://www.generationrent.org/2023/05/19/the-renters-reform-bill-our-verdict/> accessed 01st November 2023.
[15] Daniel Bacon. ‘No-fault Evictions: One Door Closes, Another Opens’, The New Law Journal (Sutton, 1 September 2023). 173. 8038. <https://www.newlawjournal.co.uk/content/end-of-the-road-for-assured-shorthold tenancies> accessed 1st November 2023.
[16] ibid
[17] Suzanne Smith. ‘What Abolishing Section 21 Means for Private Landlords’. (The Independent Landlord, 24 October 2023). <https://theindependentlandlord.com/Section-21-abolition/accessed 27th October 2023
Bibliography
Legislation
The Housing Act 1988.
Secondary Sources
Journal Articles
Simson K.V and Umblijs, J. ‘Housing Conditions and Children’s School Results: Evidence from Norwegian Register Data: Moving Always Report’ (2021) 21(3) International Journal of Housing Policy 346.
Newspaper Reports
Goodier, M. ‘No-fault Eviction Proceedings Hit Highest Level for Six Years in England’. The Guardian. (London, 10 August 2023).
Websites
The Conservative and Unionist Party Manifesto. ‘Conservative Party Manifesto 2019’. (24 November 2019).
Bacon, D. ‘No-fault Evictions: One Door Closes, Another Opens’, The New Law Journal (Sutton, 1 September 2023). 173. 8038. accessed 1st November 2023
Department for Levelling Up, Housing and Communities. ‘Guide to the Renters (Reform) Bill’. (Gov.uk, 17 May 2023).
— —. ‘English Housing Survey 2021 to 2022: private rented sector’. (Gov.uk, 13 July 2023). accessed 25th October 2023
Generation Rent, ‘The Renters Reform Bill’. (Generation Rent, 21 October 2023). Goodlord’s Newsagent, ‘How Have Plans to Abolish Section 21 Changed the Lettings Sector?’ (Tenancy Deposit Scheme, 2022).
LV= General Insurance, ‘Share of Landlord-Tenant Disagreements in the United Kingdom (UK) in 2019, by Frequency’. (LV=, January 2020).
O’Shea, C. ‘The Renter’s Reform Bill: Our Verdict’. (Generation Rent, 19 May 2023). S, Smith. ‘What Abolishing Section 21 Means for Private Landlords’. (The Independent Landlord, 24 October 2023)
