Update on Gas Safety Certificates and Section 21

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Landlords were extremely concerned last year over an appeal court ruling that meant Section 21 notices were invalid when a landlord had failed to serve a Gas Safety Certificate at the commencement of the tenancy.

What’s more, the error could not be mended. The ruling meant that the tenant effectively had a protected tenancy – no chance of eviction unless there was a serious and provable breach of the agreement using Section 8.

The original appeal ruling was the County Court appeal decision of Caridon Property Ltd v Monty Schooltz, which confirmed that the landlord’s failure to provide a copy of the gas safety certificate before the tenant occupied the property was a breach that could not be rectified.

Consequently, a judgment in the much-anticipated case of Trecarrell House Limited v Rouncefield was finally handed down on 18 June 2020.

In this case the landlord again did not provide a Gas Safety Certificate to the tenant before or at the commencement of the tenancy in February 2017. The landlord did provide an up-to-date copy of the Certificate prior to serving the section 21 notice in May 2018, but the tenant refused to leave.

At the possession hearing the landlord was originally granted an order for possession, but the tenant then successfully appealed on the grounds that they were not provided with a gas safety certificate before moving in.

The case then went to the Court of Appeal (Trecarrell House Limited v Rouncefield 2020) which by a majority concluded that the confusion over the regulations between the Housing Act and the gas regulations was wrongly applied by the previous courts.

It means that the anomaly has been removed and that landlords can enforce a possession claim using Section 21 as has always been the case, providing a copy of the Gas Safety Certificate is given before the Section 21 notice is serviced.

This comes a relief to landlords. Although evictions using Section 21 are relatively rare, when it is needed it works well for landlords and gives much more certainty of outcome than Section 8. However, landlords should make sure that all other requirements: as deposit protection, licencing, EPC, Electrical and Gas Checks and the How to Rent Guide information have been supplied and complied with as they can all affect the validity of a Section 21 notice.

The irony is that Section 21 is to be abolished in the coming months – currently delayed by Covid – but supposedly to be replaced by a more effective version of Section 8. We shall see!

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Sub-letting tenant breaching contract but refusing to leave?

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Hi, since my last visit to my 3 bed property six months ago, my tenant on an AST has sub-letted all the rooms individually and he is occupying one of them.

He is now 3 months behind on rent and I am sure he is using covid as an excuse to stay rent free as long as possible and wants me to officially serve him notice and take him to court if I want.

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Splitting into leaseholds on freehold building to refinance

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I have a freehold building which was developed into several flats. I am looking hold on to them to rent, but would like to split into leaseholds as the mortgage rates are more competitive (the difference in rates have reduced over the last couple of years but the financing cost have gone up hugely) and it would also allow greater flexibility.

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Government urged to give young renters a break

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Landlord group joins forces with charities to push for more support for young people who face losing their income and potentially their jobs this summer

Scores of young renters will struggle to pay their rents as the furlough scheme is wound down, homeless charities warn.

Together with The National Residential Landlords Association (NRLA), Crisis and Centrepoint are calling on the Government to boost the safety net available to young renters before the Government’s subsidy – currently 80% of wages – starts to drop.

The NRLA’s research shows that 24% of private renters aged 16-24 and 27% of those aged 25-34 are reliant on the Coronavirus Job Retention Scheme. It says young renters have taken the largest hit to their incomes of any age group; 56% of 16-24 year olds report that their incomes haven’t been affected as a result of COVID-19, while 76% of those aged 65-74 say they haven’t been badly hit. Despite this, 84% of 16-24 year olds and 87% of those aged 25-34 have been able to pay their rents as usual. It says this proves how reliant they are on Government support to make ends meet.

Following the decision to increase the Local Housing Allowance to cover the bottom 30% of rents, the NRLA wants ministers to now go further by suspending the benefit cap. It also wants advance loans given to Universal Credit claimants to cover the five-week waiting period to receive the first payment of the Credit converted to grants.

NRLA chief executive Ben Beadle says: “Both tenants and landlords need the security of knowing rents can continue to be paid, just as with mortgages and rents for social housing.” 

Together with the Chartered Institute of Housing, The Property Redress Scheme, My Deposits, the Tenancy Deposit Scheme and ARLA Propertymark, the NRLA has launched new guidance offering practical ways for landlords and tenants to address arrears building as a result of the pandemic. 

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BTL product options on the increase

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As pent-up demand built up over the recent lockdown is released, Moneyfacts.co.uk has analysed how the buy-to-let mortgage market has changed over the year so far.

Landlords will be pleased to see that the choice of products has improved recently.

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Young renters will need help

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Young people in private rented housing will be especially vulnerable to losing income and potentially their jobs as the furlough scheme scales down.

Polling for the National Residential Landlords Association shows that 24% of private renters aged 16-24 and 27% of those aged 25-34 are reliant on the Coronavirus Job Retention Scheme.

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