Disclaimer: this could be deemed as a long and painful read, but it’s crucial for landlords in England to make the journey until the bitter end, even if that requires a couple of hits of espresso and/or the white powder. MOST landlords have either used and/or will use a Section 21 notice, so the odds are this post will be relevant.
I honestly can’t remember the last time I published so many blog posts in the space of 30 days. This will be my 3rd, which may not sound like much, but this is nose-bleed territory for me. I’ve been struggling to maintain a mere one-per-month frequency for quite some time now. As a percentile, my production rate has unwillingly increased by 300%. Perhaps a sign of progression for most, but I feel so depleted.
Understandably, this sudden surge may also be freaking-out some of you regular readers and subscribers. But I don’t want anyone to panic. This is just a very temporary blip, I hope. I know one thing for sure, I can’t continue operating at this pace because I’ll completely burn out.
That said, what the fuck is going on, right? Have I recently discovered a new-found passion for blogging? Hell no. Strapping myself down to a desk for the best part of 3 hours once a month, only to squash together some mincy words, is still a dissatisfying routinely struggle.
The real reason behind this flurry of activity is the Government’s need to introduce big changes to the lettings legislation all at the same time, which are all allegedly for the greater good (I won’t go there). I’ve tried staggering the updates out as much as I can, so you’re not overloaded with junk and boring shit to crunch through, but the deadlines for some of the requirements/changes are approaching hard and fast, so here we are…yet again, so soon.
As a quick recap, here are the most recent legislation changes I have already discussed, which all Landlords in England & Wales should be aware of:
- Landlord Selective Licensing Scheme
- ‘Right to rent’ immigration checks
- Landlord Smoke and Carbon Monoxide Alarm Regulation
And now, the new proposed rules for Section 21 notices for landlords in England.
I definitely advise ALL landlords to pay attention, although I appreciate it’s very limited appeal in nature. I’m not exactly flogging discount iPads here. But what can I do? I can only work with what’s shoved on my plate!
What is a Section 21 notice?
Before exploring deeper into this garbage, it’s probably a good idea if I cover the basics, just so we all start off on a level playing field…
A Section 21 notice is a document that is served by the landlord to their tenant in order to legally give advance notice of a tenancy termination. It is NOT an eviction notice, it is simply a notice saying, “Hey, as soon as the tenancy comes to an end (e.g. the fixed end date has expired), I want you to vacate”
So in terms of landlords repossessing their properties, it’s a pretty big deal.
While a Section 21 notice is crucial to ending a tenancy legally, it is also one of the most effective methods of removing rogue tenants efficiently. You can read more about Section 21 notices and how they currently work over on the main S21 blog post– which is still valid for landlords/tenants in England & Wales, and will remain valid for all tenancies that started before October 2015. However, for tenancies in England that start on or after October 2015, changes are coming…
The importance of complying with the changes
I can’t emphasise enough how important is to ensure you comply with the requirements so you’re in a position where you can serve a valid section 21 notice. Consider a valid S21 more important than family.
If you can’t serve a valid one it is going to be near impossible to repossess your property if you’re tenant is reluctant to leave and is prepared to go to court over the matter. You, as the landlord, will most likely be screwed.
Normally, if landlords want to repossess their property and do not have the grounds to evict, a section 21 is the only reliable and effective solution. Without that option, you could be left in a position where you cannot legally end the tenancy, so you may just have to wait until the tenant decides to surrender the tenancy, or gives you grounds for eviction. Neither could happen any time soon. The only other inadvisable and highly illegal option is to go Terminator on your tenants: smash through the front door and drag them out by their teeth. It’s been done before.
So what’s going to change?
So much so that the new rules (The Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015) was beyond my feeble mind to comprehend, at least with confidence. I looked over the incoming changes and the dialogue frazzled my mind. Trying to breakdown the 1920’s old English scripture, which the Government call the legislation, would have lead to my brains being splattered all over the walls (perhaps an early Christmas present for some).
On the basis that I value my life, I reached out to someone whom I genuinely believe to be one of the most competent and well informed creatures in the lettings industry. If anyone could explain the new rules in a way that anyone normal and partially stupid can understand, it’s the saucy little minx I flushed out from a pool of stuttering dead-beats.
My already glowing review should be enough make you feel like you’re in safe hands, but I will also mention that she’s a recognised published author in the field. I personally haven’t read any of her boring landlord books (they were each more than 20 pages long, spare me), but I have read many of her articles on various other landlord/letting websites, and I quickly noticed how well she manages to explains circumstances, even the dry and convoluted legal issues. As many of you will know, that’s a rare and a beautiful pleasure in this hellhole industry- to actually have the legislation explained clearly.
I’ve already tried reading other industry experts explain the changes and it left me in a state of confusion, along with a banging headache. I even saw some hopeful fool attempting to simplify the changes with an info graphic– that was a pile of shit if ever I’ve seen one. Trying to break down this particular legislation into a graphical interface was always destined for failure. I didn’t understand what the hell it was trying to tell me, what a total mind-fuck.
Anyways, I reached out for her help with a few pleading words, assisted with a few pictures from my personal collection… let’s just say… she compared me to an elephant (I won’t repeat her exact words), and quickly became putty in my hands. She said she’d do it. She also said she’d explain the changes to the section 21 regulations for my blog! Amazing!
She has requested for anonymity, because naturally her association with my blog will probably burn her fruitful career to the ground, but on the flip-side, it means she’s able to express herself more freely than usual, without persecution. The following is all her (minus a few impulsive additions by myself)…
Section 21, NO longer the Landlords best friend!
On 7th September the Government published their new regulations for Section 21 Notices, which introduced “new” obligations on landlords who want to serve a valid S21 notice, which will come into play on the 1st October 2015.
Here’s a quick overview of the implications of the new rules…
- Changes start for new tenancies which begin on or after 1st October 2015 but do not apply to Statutory Periodic Tenancies offered to existing tenants.
- This only applies to properties which are rented in England, not in Wales or Scotland.
- Tenancies in Wales are still subject to the current Section 21 rules, as are tenancies in England that started before October 2015.
- Tenants must be given certain information WHEN THE TENANCY BEGINS.
- Landlords must meet specific requirements for these tenancies or they will never be able to use a Section 21 Notice to repossess their property.
Now, let me explain what it all means so it makes more sense. Yes, you can read this on several web sites, but this is written by a real landlord who knows exactly what it means to us, so I’m able to translate the implications in real practical terms, as opposed to simply reciting the legal jargon without context.
The good news
But don’t get too excited, it’s pretty much the only good news.
Section 21 Notices must be served on a new prescribed form – FORM NO. 6A Notice Seeking Possession of a property let on an Assured Shorthold Tenancy. This new form will replace the current Section 21 notices 21(4)a and 21(1)b – you will NOT be able to serve those notices to new tenancies in England that start after or on October 2015.
The new form is not available yet but you won’t need it for 4 months, as you will see why!
Why is this good news?
It will stop us from screwing up the dates of possession and getting to court to have the case thrown out because it is not a valid notice. Many repossession cases have been thrown out of court and delayed for several months because the dates on the notices were incorrect. They were mostly trivial errors, but it caused major problems.
The Form 6A makes it clear when Possession can be requested and there is no longer a need to take account of the “last day of a tenancy period” so long as we follow the information on the 6A which includes time allowed for delivery by post (2/3 days).
What does the landlord have to do to serve a valid Section 21 Notice from 1st October?
Remember, this only applies to tenancies that begin on or after 1st October 2015. Tenancies which started before can rely on the current/old method and rules.
At the start of the tenancy the tenant must be given:
- Requirement 1: Energy Performance Certificate (EPC)
- Requirement 2: Gas Safety Certificate
- Requirement 3: A copy of the Government’s “How to Rent” Guide (either current version at start of current tenancy, or the latest version before service of the Section 21 notice).
On the face of it this all seems straightforward, but let’s look at each one in relation to the legislation, because you’ll soon begin to realise, just as I did, that the pretty face is a strategic ploy to distract from the pure evil lurking under the dress.
An Energy Performance Certificate
Does this mean that the landlord can now ignore the legislation which says that we must show it at viewing?
in the case of a person who makes a request to view the building, the time at which the person views the building.
The whole point of showing a tenant the EPC is so that they can decide if they can afford the fuel bills, what would be the point in giving them the EPC after they have signed up? Unless you want to risk your Section 21 and be a test case, provide a copy before you sign the tenant up and get proof that you did.
Gas Safety Certificate
Under gas regulation 36(6)), landlords should ensure that:
(a) a copy of the record made pursuant to the requirements of paragraph (3)(c) above is given to each existing tenant of premises to which the record relates within 28 days of the date of the check; and
(b) a copy of the last record made in respect of each appliance or flue is given to any new tenant of premises to which the record relates before that tenant occupies those premises.
So, for all new tenants, they should be provided a copy of the Gas Safety Certificate before they move in (yes, similar to the EPC, so it would be a good idea to serve them both at the same time).
A copy of the Government’s How to Rent Guide
You can download this here.
The first 6 pages of this 8 page document give tenants advice and information about what to do before they agree to rent a property – what the hell is the point in forcing landlords to give to a person who has already signed a tenancy agreement? Baffling. That’s destined to gather dust and/or become very uncomfortable toilet paper, no doubt.
I must also note that the book is subject to get updated over time, so it’s important to ensure you download the latest version when your tenancy begins. Providing an out-of-date guide could be a loophole waiting to be abused by tenants looking for a reason to laugh in the face of a Section 21 notice.
For more information on the guide and the requirements to serve it, go to the main ‘How to Rent’ Guide for tenants post.
Deregulation Act 2014
Ok, so some of you may or may not know, but the above is all in addition to the changes that were made in the Deregulation Act 2014 which also apply from 1st October, which means the following:
- Requirement 4: Tenants Deposits must be protected and the Prescribed Information for Tenants and Deposit Protection Certificate must be given to the tenant and anyone who has provided all or part of the deposit within 30 days of the money being paid.
- Requirement 5: The Property must be licensed where the law requires – either a mandatory HMO or in an area where there is Selective or Additional licensing in place. Selective licensing is spreading like a nasty rash don’t get caught with your ass exposed.
- Requirement 6: Preventing retaliatory eviction (Section 33 Deregulation Act 2014)
Preventing retaliatory eviction
Let’s take a closer look at the last point…
This is arguably the biggest change, and it’s been slung into the regulations to prevent the so-called “revenge eviction” phenomenon, which is when a landlord allegedly evicts tenants when they complain about repairs that need attending.
This is what the new legislation says:
A section 21 notice given in relation to an assured shorthold tenancy of a dwelling-house in England is invalid where—
- (a) before the section 21 notice was given, the tenant made a complaint in writing to the landlord regarding the condition of the dwelling-house at the time of the complaint,
- (b) the landlord—
- (i) did not provide a response to the complaint within 14 days beginning with the day on which the complaint was given,
- (ii) provided a response to the complaint that was not an adequate response, or
- (iii) gave a section 21 notice in relation to the dwelling-house following the complaint,
- (c) the tenant then made a complaint to the relevant local housing authority about the same, or substantially the same, subject matter as the complaint to the landlord
- (d) the relevant local housing authority served a relevant notice in relation to the dwelling-house in response to the complaint, and
- (e) if the section 21 notice was not given before the tenant’s complaint to the local housing authority, it was given before the service of the relevant notice.
Essentially, landlords will not be able to serve a valid Section if…
- the tenant has made a written complaint to the landlord about the condition of the property before the notice was served; and
- the landlord has not provided an adequate written response (e.g. clarify what actions you are going to take to resolve the problem and to what timescale) within 14 days; and
- the tenant has then complained to the relevant local authority about the problem, who then serve an “Improvement/Remedial notice.”
The alarm bells are ringing because the tenant could just complain about bullshit and make it increasingly difficult if the local authorities side with the tenant (which they often do). Although, good landlords needn’t worry, I suspect. The notice only becomes invalid if a Improvement/Remedial notice is served by the Council. I wonder how many tenants will know that?
Which brings me to my next point, a lot of this will be based on how much a tenant knows about their rights and the new legislation, which I suspect will be very little. In theory, a tenant could make a written complaint to the landlord (how many tenants actually send written complaints?) and then the landlord could still serve a section 21 notice. If the tenant does not take the next step, which is to complain to the Council and get an Improvement/remedial issued to the landlord, the Section 21 will still be valid.
Bear in mind, this will also be very much reliant on how quickly the Council can react to complaints, because if they issue an Improvement/Remedial notice AFTER the Section 21 expires, it will be useless because the landlord will already have legal possession of the property. The window of opportunity will usually be around 2-3 months, because that’s how much notice landlords give their tenants.
When can I serve a Section 21?
The many letting agents and landlords who habitually serve a Section 21 at the start of the tenancy, or at signup are going to hate this one.
You will NOT be able to serve a Section 21 notice within the first 4 months of a fixed term from the original tenancy (so this excludes periodic tenancies and tenancy renewals). That’s the first major change when it comes to serving the notice. So that poses the question… how will you serve a Section 21 notice to expire on the last day of a 6 month tenancy if I cannot serve in the first 4 months? You can’t. Notice periods will now expire a few days after the end of a 6 month fixed term. If a tenant moves out on the final day of the notice period, the legislation makes it clear that landlords should repay the remainder of the rent for the month to the tenant.
How much notice do we have to give our tenants?
There still a minimum of two months’ notice, and that’s how much notice most of us will need to give. But unlike the old Section 21 notices, there is no need for landlords to end their notice on a period of a tenancy (e.g. if the tenancy started on the 14th July 2015, we won’t need to end it on the 14th of July 2015). They just need to comply with the correct time period.
Where a periodic tenancy period runs quarterly or biannually, landlords will still need to give an appropriate matching period of notice (e.g. 3 months’ notice for quarterly tenancy periods, 6 months’ notice for biannual and above).
As always, a Section 21 notice period cannot end during a fixed term unless permitted to enforce a break clause.
So, there you have it. A lot more “to do”, but generally, there’s a few good and bad changes.
Back over to the landlord now…
Using a letting agent?
I can only advise you to ensure that whoever or whatever is managing your property is following all the legal and sensible procedures!
Incidentally, it was only the other day that someone left a comment on my blog, saying that with all these regulations coming into play it might be worth handing the management responsibilities over to an agent.
I’ll just copy/paste my response:
While I do understand your point, the problem is that not all letting agents actually follow or are completely aware of the legislations. But more importantly, it is ultimately the landlords responsibility to ensure the legislations are met, not the hired helps. So even the landlords that choose to use managed services should be aware of the laws, that way they can be sure they are being met… because if they’re not, it will be the landlord wearing the cuffs.
I have no problems with landlords using managed services, it suits some landlords better. However, I don’t think that should ever be a reason for landlords not-knowing their legal responsibilities and best practices.
As it stands, that pretty much covers the most significant incoming changes we should all be looking forward to, and I hope it’s a little clearer for you. However, since the information in this post is based on draft guidelines, some elements may change once the final guidance documents are released on 1st October 2015, in which case I’ll make the appropriate updates. But I doubt much will change.
My further thoughts…
- Sign ’em up – If you’re on the verge of getting new tenants, it might be worth signing them up before the 1st of October 2015 (even if that means they don’t move in until after), so you can rely on the current section 21 legislation, which evidently comes attached with much better protection and less confusion for landlords.
- Tenant referencing – It goes without saying that rigorous tenant referencing has always been imperative, but if it’s possible, it just became even more important to get it right. There’s now plenty of new scope for tenants, on top of what they are already treated to, to take advantage of the new rules (i.e. retaliatory eviction) and punish landlords. I’ve always been a loyal advocate of waiting for the “right tenant” even if that entails longer void periods.
- Allow the tenancy to roll – instead of renewing contracts with existing tenants when the time is right, you might be better served by allowing the tenancy to roll onto a periodic tenancy, that way you’ll still be subject to the old rules.
If you have any questions, or if you need anything explained further, leave a comment below. My lady-friend will go by the alias SheLandlord and will happily address all your concerns! Also, as usual, general comments/thoughts about this issue or any other welcome (including any nasty burning sensations you or “a friend” is experiencing)…
Disclaimer: I'm just a simple landlord blogger; I'm not qualified to give legal or financial advice. Any information I share is my opinion based on my personal experiences as an active landlord, and should never be contrued as legal or professional advice. For more information, please read my full disclaimer.