UK Government must clarify plans for abolishing Section 21 no-fault evictions, Propertymark argues

Propertymark is keen for the UK Government to clarify how it plans to abolish Section 21 no-fault evictions and what new legal mechanism will be deployed to prevent the court system in England and Wales from being overwhelmed.

Prior to the King’s Speech today, Wednesday 17 July, it was reported Labour intends to legislate an enhanced version of the previously known Renters’ Reform Bill, which the Conservatives ran out of time to implement before former prime minister Rishi Sunak called a general election.

Banning Section 21 no-fault evictions is set to be a central feature of new legislation moving forward, thereby mirroring what the Conservatives had intended to implement.

Although energy efficiency was front and centre of the King’s Speech, no precise measures were announced that would directly help landlords and agents to make properties carbon neutral.

The King said during his speech: “Legislation will be introduced to give greater rights and protections to people renting their homes, including ending no fault evictions, and reforming grounds for possession.

“Draft legislation will be published on leasehold and commonhold reform.”

The professional body has previously argued that replacing Section 21 without an adequate and workable alternative would trigger lengthy and costly delays for everyone involved, and that the volume of regulatory and financial pressures on landlords in recent years would further hinder investment in the private rental sector. This could cause many more landlords to sell up and prevent future landlords from entering the market altogether. Potential consequences of landlords leaving the private rental sector include initiating a further shortage of homes for tenants, which will ultimately could push rents up even more. 

When the Conservatives looked to abolish Section 21 as part of their original Renters’ Reform Bill, Propertymark presented written evidence to the Public Bill Committee on the anticipated law back in December 2023. The data demonstrated private landlords were worried about the mechanism being abolished without a suitable and robust alternative.

Section 21 notices enable ‘accelerated’ claims to miss the court system.

The Conservatives’ Renters’ Reform Bill would have led to the grounds for possession being enlarged under Section 8 instead – which would have resulted in many more cases having to pass through the courts. But it remains unclear how Labour’s plans will work for now.
 
In May 2023, letting agents and landlords were worried they would end up in limbo, concerned about how long they would have to wait for a hearing to happen and, ultimately, how long repossession of their property would take place. Propertymark hopes that Labour’s latest ambitions won’t have the same effect.  

The former government agreed with Propertymark’s recommendations that the court process should be speeded up, and that rent should be agreed between the landlord and the tenant.

Nathan Emerson, CEO at Propertymark, said:

“The Renters’ Reform Bill caused great uncertainty for many landlords when it was introduced by the last government, so we hope that the new UK Government’s revised version of this legislation clarifies what new mechanism will be implemented if they succeed in abolishing Section 21.  

“Whilst Propertymark supports renters having firm rights to challenge unfair practice, any new legislation must strike a fairness for all involved. Ultimately, there is a concerning lack of housing stock within the marketplace, and there needs to be clear pathways and support for investment to help boost supply and provide choice for prospective tenants when it comes to choosing a new home.  

“Many tenants have also faced high energy bills in recent years, and while it is positive to see that the new UK Government has made clean energy one of its central pledges, Propertymark has long called for landlords and agents to be provided with loans and grants to make energy efficiency improvements in their homes, thereby allowing the housing sector to play a leading role in achieving net zero.”