Prime Minister Liz Truss has confirmed her government's commitment to abolishing section 21 under the Renters' Reform Bill.
After speculation in the press, Prime Minister Liz Truss has reconfirmed her commitment to abolishing section 21, in her first PMQ session after the mini-budget announcement. The A Fairer Private Rented Sector White Paper outlines the government's plans to outlaw section 21 and "replace section 21 ‘no fault’ eviction notices with a modern tenancy system".
The paper proposes simplifying tenancy structures by transitioning all tenancies to periodic - meaning that the tenancy will end only if the tenant chooses to leave, or if the landlord has a valid reason, as defined by law.
What is section 21?
In normal circumstances, when extended notice periods are not in place, landlords can evict their tenants under section 21 by providing them with two months’ notice once their fixed-term contract has come to an end.
Landlords aren’t required to provide their tenants with a reason for eviction, hence the term “no-fault” eviction. In contrast, to serve a section 8 notice, the landlord needs to prove that the tenant has broken the terms of the tenancy agreement.
What's changing for section 21?
One of the proposed changes set out in the Renters' Reform Bill and confirmed in the new white paper, is to remove section 21 eviction notices.
The abolition of section 21 would put an end to so-called “no-fault evictions”, and instead transition all tenancies to periodic, as part of the on-going project to create longer tenancies.
What do these changes mean for landlords and tenants?
After the end of section 21, landlords will always need to provide their tenants with a reason for ending a tenancy, for example, breach of contract or wanting to sell the property.
Tenants will be able to choose to end the tenancy at any time, as long as they provide two months' notice to the landlord.
The white paper outlines that this will also help student tenants who may not wish to move out at the end of the academic year, for example, as they will also be included in the scope of the reforms and will get the "same opportunity to live in a secure home and challenge poor standards" as private renters.
What will replace section 21?
Once section 21 is abolished the government has also proposed strengthening the grounds for possession under section 8 of the Housing Act 1988.
The government has shared that the changes it makes will ensure that "responsible" landlords can gain possession of their properties efficiently from anti-social tenants and will be able to sell their properties when they need to.
It will also "target the areas where there are unacceptable delays in court
proceedings [and] strengthen mediation and alternative dispute resolution".
You can read more about the new grounds in our guide.
How will these changes to section 21 affect tenancy lengths?
This new single system for all private rented tenancies when section 21 is abolished, with all agreements moving to periodic, will mean that there will be no set end date on a tenancy.
All Assured and Assured Shorthold Tenancies will convert to these periodic tenancies, and the tenant will be able to give two months' notice at any time to leave the property, while landlords must provide a valid reason to ask their tenants to leave.
In some instances, such as the landlord wishing to move into the property or to sell it, landlords will not be able to evict a tenant within the first six months of the contract start date.
How will the new system be enforced?
The paper warns landlords and agents that "any attempt to find loopholes will not be tolerated".
The government has said that it will "consider the case" for new or strengthened penalties to support those currently in existence, including the power for councils to issue Civil Penalties Notices. It will also explore how to support local councils in tackling illegal evictions.
When will section 21 be abolished?
When section 21 is scrapped, the government will transition to the new system in two stages, with at least six months' notice of the dates that they will take effect, and at least 12 months between the two dates.
- Stage one will transition all new tenancies to periodic, governed by the new rules
- Stage two will move all existing tenancies to the new system
The government has outlined that the Renters' Reform Bill, including these measures to abolish section 21, will be "introduced in this parliamentary session".
This article is intended as a guide only and does not constitute legal advice.