Scrapping Section 21 will trigger a rise in homelessness

admin    Uncategorized     agents

Section 21:

Leading tenant
eviction company, Landlord Action, says that as many as 50% of
Section 21 cases they handle are as a result of tenants wanting to be
re-housed by the council.

They believe the
abolition of Section 21, and subsequent expansion of Section 8, could
put thousands of tenants at greater risk of receiving a County Court
Judgement (CCJ) and ending up homeless as local councils will not be
obliged to re-house those with rent arrears judgements.

According to
Landlord Action, 95% of Section 8 cases are for mandatory two months’
rent arrears. It is unknown how many Section 21 cases are as a
result of rent arrears, but Landlord Action says it is the number one
reason landlords serve notice.

Data from the
Ministry of Justice reports that there were 22,527 accelerated
possession claims issued in 2018 (section 21 claims). Of those
accelerated possession claims under Section 21, 10,127 resulted in
evictions carried out by County Court bailiffs.

Therefore, if
landlords are forced to use Section 8 route in the future, thousands
more tenants will have rent arrears judgements against them, rather
than simply being evicted using Section 21. In addition, more tenants
could find themselves with a County Court Judgement (CCJ), which will
severely impact their future credit rating.

Commenting on what
this means for tenants, founder of Landlord Action, Paul Shamplina,
says:

“Local councils
will see when a tenant has a rent arrears possession order made
against them so will consider that that tenant has made themselves
homeless. Therefore, the council will not be obliged to re-house
them as they do at present under Section 21 accelerated procedure. If
those tenants cannot get accommodation in the private rented sector
and cannot be re-housed by the council, what will happen to them?�

In addition, Paul
Shamplina is concerned that the figures demonstrate that the number
of Section 8 hearings will double because landlords who would
previously have used Section 21 will use Section 8. This will double
the amount of court time before judges that is required, meaning that
a major recruitment drive of judges will be required to deal with the
increased number of hearings.

Recently, MHCLG
attended Landlord Action offices shadowing the solicitors and
para-legal staff to gain a greater understanding of the possession
process, and what impact reforms to Section 8 and court processes
could have.

“As well as a rise
in homelessness, I believe there will be many other unintended
consequences following the abolition of Section 21. These will
include, but not be limited to; vulnerable tenants struggling to find
accommodation as landlords become more selective; a surge in Section
21 claims as landlords feel increasingly powerless and opt to exit
the market.

“A shrinking
private rented sector will result in further rent rises for tenants.
In addition, unless anti-social behaviour is tackled within the
reforms, unruly tenants will have the opportunity to remain in
properties for longer causing landlords and their neighbours
unnecessary stress.�

The government
consultation on Tenancy Reform ends on 12th October. Landlord Action
is urging all landlords and lettings agents to have their say and
complete the survey as a matter of urgency.

https://www.surveymonkey.co.uk/r/52JFF5T

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Scrapping Section 21 will trigger a rise in homelessness | LandlordZONE.

View Full Article: Scrapping Section 21 will trigger a rise in homelessness

If you enjoyed this article please consider sharing it!