Section 21 notices – where are we now and what does the future hold?

Posted: 20/08/2024

The question of whether section 21 notices should be abolished has been the subject of debate for several years, with the former Conservative government first announcing it would abolish section 21 in 2019. Following the change to a Labour government, this article takes stock of the current situation and what the future holds if section 21 notices are abolished. 

Section 21 notices – the law

Section 21 of the Housing Act 1988 allows landlords to regain possession of their property without having to give any grounds, for example rent arrears, once the fixed term has expired. It is important to note that the section only applies to assured shorthold tenancies. When using section 21 to regain possession, the landlord is required to give at least two months’ written notice to the tenant. The landlord cannot serve this notice during a fixed term tenancy unless there is a break clause, and the notice must be served correctly using the prescribed form 6A. The use of section 21 is also known as ‘no fault’ eviction.

Section 21 notices can be technically tricky to get right. There are a number of legislative requirements that a landlord must fulfil in order to serve a valid section 21 notice, and in part, these requirements offer protection to tenants from unlawful or retaliatory evictions. 

When relying on a section 21 notice as a ground for possession, a landlord has the option of issuing a claim via the accelerated possession procedure. The accelerated route can be much quicker than the standard procedure where the claim is undefended and an order for possession can be granted by the court without listing a hearing. 

It is important to note, however, that landlords cannot claim rent arrears via the accelerated route, and a separate money claim would need to be issued where arrears are outstanding. In the interests of recovering possession more quickly, landlords will often make a commercial decision to recover possession via the accelerated route and recover any arrears by way of a separate money claim. 

The debate 

The Conservative government first made provisions for the abolition of section 21 in the Renters Reform Bill. Since the Labour government has come into power, it has been confirmed that it will not be proceeding with the Renters Reform Bill, and a new Renters’ Rights Bill is to be drawn up that will include proposals to abolish section 21. This was also addressed in the King’s Speech, where the King advised that the bill will ‘overhaul the private rented sector’.

The government will need to balance offering tenants greater security and removing the threat of arbitrary evictions with the potential upheaval in the rented sector if landlords are prevented from relying on section 21 notices to terminate tenancies.

There are strong opinions held by both landlords and tenants on each side of the debate, and it will prove difficult for any legislative change to accommodate all concerns arising from the abolition of section 21. 

The rhetoric in the media when talking about the abolition of section 21 notices is often on the basis of a ‘fairer rental sector’ where tenants can report disrepair or challenge rent increases without the fear of eviction. What can sometimes be overlooked in these discussions are the current protections already in place for tenants against retaliatory evictions. A section 21 notice cannot be served by a landlord when they have failed to comply with certain legislative requirements, and this in itself offers a certain degree of protection to tenants.  

Short/long-term consequences 

The abolishment of section 21 no fault evictions will have short and long-term consequences for both landlords and renters. 

In the short term, we are likely to see an increase in landlords leaving the private rented sector. One reason for this is that it will become harder for landlords to remove bad tenants once section 21 is abolished. If a tenant is not paying their rent, or participating in anti-social behaviour, the use of section 21 offered a potentially quicker route to eviction, whereas abolishment could make it a far more difficult, costly and lengthy process. 

With more landlords selling their properties, the availability of accommodation for renters will become limited, creating a higher rental demand and increased rents. This is an already ongoing problem in cities such as London, where the demand for rental properties far outweighs the availability. The abolishment of section 21 will mean landlords have to rely on serving a section 8 notice to evict tenants, which can be more time-consuming. The long term consequences of this will see landlords becoming more risk adverse when choosing renters. Tenants may face more hurdles when trying to rent, making the process more challenging than it already is.

Another consequence of relying on section 8 of the Housing Act 1988 is that more possession claims cases will require a hearing to be listed. This in turn may place additional strain on the courts, leading to further delays. 

It is clear that the government’s long-term aim with abolishing section 21 is to provide tenants with more security, and offer greater stability to those who are not in a position to own their own homes. If this can be done without a mass exodus of landlords leaving the rental market and rents increasing to an unaffordable rate, then this will be a positive step for renters and wider society. 

What should landlords do now and in the future? 

Whilst section 21 remains in force, for those landlords looking to serve a section 21 notice, it is strongly recommended to seek legal advice, to ensure all legislative requirements have been complied with for a valid notice to be served. The technical complexities of section 21 are often underestimated, and landlords frequently serve their own notices that later prove invalid because not all requirements have been fulfilled. As such, to avoid delays from having to serve a notice again, it is worthwhile obtaining legal advice at the outset of the matter.

Where a tenant is in rent arrears, a decision will need to be made as to whether to issue a claim via the accelerated possession procedure and to pursue the arrears separately, or to go via the standard possession procedure, where a money judgment for arrears can be entered into at the same time as the court making the order for possession. The decision will in part turn on the level of arrears outstanding. 

Where the arrears exceed two months or eight weeks of rent, and mandatory ground 8 for rent arrears is made out under a section 8 notice, it may prove beneficial for a landlord to issue a claim via the standard possession route, relying on both a section 21 notice and a section 8 notice in the alternative, to obtain an order for possession and money judgment under one claim. 

In the event that section 21 notices are abolished, landlords will need to ensure they closely monitor their housing stock and look to commence repossession action promptly if there are any breaches of tenancy by serving a section 8 notice. It has not been confirmed whether the new Renters’ Rights Bill will contain the amended grounds for section 8 that were proposed under the Renters’ Reform Bill. The former proposals included two new mandatory grounds: one for possession where landlords intended to sell the property, and another where a tenant has fallen into more than two months’ arrears at least three times within the previous three years. If they are passed into legislation, landlords should look to rely on these grounds when available. 

Since the Labour government has decided to go back to the drawing board with the Renters’ Rights Bill, it is unlikely that we will see any new legislation passed to abolish section 21 before 2025. The bill will first need to go through both houses of parliament, and if it is a similar length to the Renters’ Reform Bill, this is likely to take some time.

This article was co-written with Olivia Masterson, paralegal in the real estate litigation team.

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