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Renters Reform Bill – Highlighting Repossession Changes for Landlords

Updated: Jun 26, 2023

New Rules around Terminating Tenancies and Evicting Tenants – Section 8, Grounds for Possession Explained

Lots of our Landlords have been asking us to explain the new Section 8 rules and how it differs from the current Section 21 regulations.


We’ve assembled a quick guide to give you an overview of the practical (on the ground) changes.


It’s official, the first draft of the Renters Reform Bill (published in May 2023) is looking to abolish Section 21.


What is Section 21 - here’s a snapshot:


It’s the ability for a Landlord to terminate tenancy agreements with two months’ notice, without needing to give a specific reason to anyone, including the Tenants.


We could wax lyrical all day about the knock-on effect that this will have on the economy but instead we’re just going to take a look at the avenues Landlords will need to travel in order to repossess their properties.


Once passed into law, Landlords will need to follow the revised Section 8 Grounds for Possession. These include:


REPEATED SERIOUS ARREARS

Notice can be served if Tenants have fallen into rent arrears at least three times in the past three years; the rent arrears must be at least to months per incident.


As an example, if a tenancy that started in 2020 and a tenant missed rent payments in:

  • January and February of 2021;

  • March and April of 2022;

  • May and June of 2023

then you could seek possession under "serious arrears". This is the minimum required in order to action this type of repossession. If any of these incidents were reduced to under two months then this would not be applicable.


Please note, rent arrears due to Universal Credit delays are excluded (meaning you can’t action an eviction because of a delay in payment due to the Universal Credit system).


LANDLORD OR CLOSE FAMILY MEMBER MOVING INTO THE PROPERTY

Landlords will be able to serve two months’ notice on Tenants if they themselves or a close family member (yet to be defined) need to move into an occupied property.


If you’re thinking of trying to use this ground to reclaim the property and then “change your mind”, in order to re-tenant it, then think again. Provisions will be put in place to prevent you from renting the property immediately. Under the new guidelines, advertising will be allowed three months after the previous tenancy ends, with a new tenancy permitted to begin after six months have passed.


In practice, this means that if your tenants leave on February 1st then a new set of tenants will need to wait until August 1st in order to move into the property.


SALE OF THE PROPERTY

A Landlord can seek possession of their property if they intend to sell it. This can only be used if at least six months have passed since the start of the tenancy.


Same conditions as above will most likely apply regarding re-tenanting the property.


ANTI-SOCIAL BEHAVIOUR ORDER

It looks like it’s going to be a little bit easier for Landlords to evict tenants for behaviour that falls short of criminal anti-social behaviour as the wording has changed from “behaviour causing or likely to cause nuisance or annoyance” to “capable of causing”.


It’s more like the bar has moved ever so slightly down, rather than getting rid of it, but, as this is a discretionary ground, a judge will need to make a final ruling based on evidence.



There are a some other grounds for possession, such as Redevelopment and Repossession by a Mortgage company, but as they’re far less likely to be used we’re not going to cover them in this blog piece.


When will Section 21 be abolished?

If this government keeps to it’s current timetable, with the Bill passing into law in the autumn of 2023, then the earliest Section 21 will be abolished is in the Spring of 2025.


Given the complexity of the Bill, and the log summer recess, it’s more likely that the Bill will pass in the next parliamentary session. This would probably push back the abolition of Section 21 Notices until 2026.


There are some other changes in the bill in addition to the eviction reforms, including:

  • Introducing the notion of “indefinite tenancies”

  • Restrictions on rent increases

  • Ban on “no DSS” and “No families / children”

  • Tenant’s right to pets

  • Private Landlords need to meet the “Decent Homes Standard”

  • Allowing tenant modifications to houses/flats in order to make the property their home


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