What Happens When Section 21 is Removed Under the Renters’ Reform Bill?

The Renters’ Reform Bill is set to bring significant changes to the private rental sector in the UK. A key feature of this bill is the removal of Section 21 – often referred to as the ‘no-fault eviction’ process. This removal is intended to offer tenants greater security, but it will also have real implications for landlords and the way they manage their properties. Let’s take a look at what this means and how to prepare.

What Is Section 21, and Why Is It Being Removed?

Section 21 of the Housing Act 1988 allows landlords to evict tenants without giving a specific reason, provided they give adequate notice and follow all legal requirements. It has often been criticised for leaving tenants in a state of uncertainty, as they could be asked to leave even when they’ve done nothing wrong.

By removing Section 21, the government aims to reduce this instability. New rules will mean landlords have to rely on Section 8, which requires them to have concrete grounds to regain possession—such as rent arrears, persistent late payments, damaging the property, causing nuisance, or needing to sell or move into the property themselves.

What Will Replace Section 21?

Instead of relying on no-fault grounds, landlords must demonstrate valid reasons for eviction under an (proposed) improved Section 8 process. The proposed changes will:

• Strengthen and clarify eviction grounds for rent arrears and anti-social behaviour.
• Introduce new grounds allowing landlords to regain possession if they wish to sell the property or live in it themselves.
• Aim to speed up the court process to reduce delays for cases where eviction is genuinely needed.

Potential Issues Arising From the Removal of Section 21

While the reforms aim to create a fairer and more balanced rental sector, they also introduce potential challenges:

1. Extended Tenancies: Tenants are likely to stay longer if they feel secure, which is great when you have good tenants. But if issues arise, such as subtle anti-social behaviour or slow but not technically overdue rent payments, it may become more complicated and time-consuming to address these problems. Especially with rent arrears increasing from 2 to 3 months.
2. Complex Evidence Gathering: Landlords must now provide detailed evidence for any possession claims. Gathering proof of wrongdoing or non-payment may require more effort and resource than currently serving a Section 21 notice.
3. Risk of Prolonged Disputes: With heightened tenant security, disputes may become more drawn-out. Tenants might contest eviction attempts more frequently, leading to longer legal processes. We also need to see the courts improved and timelines reduced.
4. Uncertainty During Transitions: For landlords selling a property or planning to move in, proving their genuine need to reclaim possession may be more challenging, potentially delaying property sales or personal relocation plans.

How Will This Impact Landlords and Tenants?

Landlords will need to be more meticulous, keeping detailed records of all communications, rent statements, property inspections, and any issues related to tenant conduct. Tenants, on the other hand, will have greater peace of mind knowing they can’t be asked to leave without a justifiable reason. But they, too, must remain compliant with tenancy conditions, rent still has to be paid on time, and properties must be looked after properly.

Preparing for These Changes

With the removal of Section 21, proactive preparation will help landlords navigate the new landscape and maintain a smooth relationship with their tenants:

1. Update Your Tenancy Agreements:
   • Ensure tenancy agreements are clear, compliant with the latest regulations, and contain robust clauses around rent, conduct, maintenance, and any other key obligations.
   • Include clauses that allow for periodic rent reviews, property inspections, and clear communication pathways.
2. Improve Your Record-Keeping Practices:
   • Maintain thorough, dated records of rent payments, inspection reports, maintenance requests, and any complaints.
   • Keep all written correspondence (emails, letters, even texts) related to disputes, requests, or breaches of the agreement.
   • Accurate documentation will be crucial for making a successful possession claim if something goes wrong.
3. Focus on Quality Tenant Selection:
   • Conduct more thorough tenant referencing, including credit checks, employment verification, and previous landlord references.
   • A stronger screening process at the outset helps reduce the likelihood of encountering serious issues later.
4. Build Positive Relationships and Communication Channels:
   • Promptly address maintenance issues and respond to tenant queries. Proactive management can nip potential problems in the bud.
   • Encourage open dialogue so that misunderstandings or issues can be resolved collaboratively before they escalate into grounds for eviction.
5. Stay Informed and Seek Professional Advice:
   • Keep up-to-date with any further legislative changes, government guidance, and best practices as the Renters’ Reform Bill takes shape.
   • Consider consulting professional letting agents, like Front Door Lettings, or legal advisors, who can guide you through compliance, procedure changes, and documentation.
6. Proactive Planning for Property Changes:
   • If you anticipate needing to sell your rental property or move in, start planning well in advance.
   • Understand the evidence you’ll need to provide and keep a paper trail to demonstrate legitimate possession grounds.

Final Thoughts

The removal of Section 21 under the Renters’ Reform Bill aims to create a fairer and more stable rental sector. While it may initially pose challenges for landlords, requiring more diligent record-keeping, thorough evidence gathering, and careful preparation, it also presents an opportunity to foster stronger, longer-term relationships with good tenants.

Wales removed section 21 back in December 2022. Under their new legislation, ‘no-fault’ evictions have been replaced by a system that requires landlords to provide valid reasons, or meet stricter criteria when seeking possession. The notice periods for evictions have generally been extended, giving tenants more security and predictability. While this has strengthened tenant protections, it has also prompted landlords to become more diligent in their record-keeping, property maintenance, and tenant vetting.

By planning ahead, seeking professional guidance, and ensuring all tenancy arrangements are in top shape, landlords can navigate these changes and maintain a successful, compliant, and respectful rental business. If you need help managing your property through these reforms, contact Front Door Lettings today. We’ll guide you every step of the way.