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Landlord Advice

Section 21 Changes

April 18, 2019

Earlier this week, the government announced new plans to stop landlords evicting tenants at short notice without a concrete evidence reason already specified in law. These changes relate to Section 21 of the Housing Act, where landlords were allowed to end assured shorthold tenancies at the end of their scheduled term through a ‘no fault’ eviction notice.

What does this mean for landlords?

For responsible landlords, which make up the majority of landlords within the private rental sector, very little will change. They will need to have good reason to remove tenants from their properties, such as rent arrears, destruction of the property, selling the home, or wishing to move back into the property.

Should any of these issues arise, the government plans to expedite Court processes, meaning that landlords are able to regain the use of their property quickly. At the moment, it takes over five months for a private landlord to regain their property should the tenant choose to fight the decision in court.

Some industry figures have called this change in legislation preposterous. According to government data from Landlord Today, 90% of tenancies are not ended by the landlord, it is the tenant’s decision to move on. Even more telling, the vast majority of Section 21 notices served to tenants stated a clear reason for the notice, and over half of these notices were served due to issues paying rent, complaints due to antisocial behaviour, or property damage. These are the very same issues cited within the proposed amendments. Landlords will still have a tool to use should something go awry.

What does this mean for profits?

For landlords concerned about their profit, this change in legislation makes the relationship that they have with their tenants all the more important. Landlords should look to choose tenants who are willing to stay on a longer-term basis, and fit out properties to a high standard, encouraging tenants to stay longer and look after the property.

This new legislation should not disrupt profits for many landlords who currently rent properties under Assured Shorthold Tenancies (AST), provided they do not change the use of their property. AST landlords may still evict tenants for cause of rent arrears, property damage, or sale of the property.

Section 8

Landlords have the option of serving their tenants a Section 8 notice. In this case, the property owner could consider serving a Section 8 notice under Ground 1, in which the landlord requires use of their property as a primary residence. However, the landlord may only serve this notice if the property was used as their main residence before the tenancy began, and therefore would not be applicable for a buy to let property. Property owners could also consider serving tenants a Section 8 notice under Ground 3, which specifies that the property was previously used as a holiday let, and the landlord wishes to return the property to that purpose.

What if you want to Airbnb your property instead?

A change in use includes a move from a long term let to a short term let or Airbnb, or it could be the landlord choosing to take back the property to live in themselves. This could see Landlords outside of London turning to Airbnb as they are able to exercise the lack of restrictions held on Landlords Airbnbing in London (90 day rule applies). 

If you would like to find out more about short lets with Airbnb in London, Liverpool or Manchester give us a call on 0207 099 4000 or email us at !

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