Section 21 Abolition Potential Catalyst For Landlord Exodus
Following the Government’s recent plans to abolish Section 21 notices or no fault evictions, the National Landlords Association (NLA) have launched a national postcard campaign which aims to inform the public and the government of the perceived negative impact revoking the current legislation would have on the private rental sector.
The postcard highlights the anxieties landlords would have without the Section 21 protections in place and the potential cause and effect this feeling of uncertainty will pass on to the tenant.
During a poll of over 3,00 landlords, the NLA found that 11% had been forced to use section 21 in the past five years with only 7% opting to use the more onerous section 8 eviction process.
When a landlord sought eviction due to a fault with the tenant, 44% used Section 21. When so many landlords are reliant on Section 21 notices, it has been claimed that the consequences of its termination could be severe.
Landlords are already losing confidence in governmental changes to the property with many claiming they victimise them.
The postcard emphasises that continuing to squeeze increased taxes on additional dwellings whilst decreasing landlord rights will lead to a further loss in confidence in the possession process and influence many to leave the market.
Unfortunately, this potential consequence is already becoming a reality. A recent report, by the Residential Landlords Association (RLA), has found that just over 25% of landlords in the private rented sector are gearing up to sell at least one of their properties by the end of the year.
Similarly, the government have also released data that has identified that 18% of landlords that represents 10% of all UK tenancies are planning to reduce the number of homes they own.
The impending exodus comes at the same time that 23% of landlords have reported a significant increase in the demand for property.
As the demand for rental property anecdotally increases, the NLA postcard reaffirms that a reducing housing stock will lead to increased rents, lower supply and a more difficult process for low income households or those with poor credit to access privately rented homes in the future.
David Smith, RLA Policy Director, commented:
“All the talk of longer tenancies will mean nothing if the homes to rent on not there in the first place.
“The Government’s tax increases on the sector are already making it difficult for tenants to find a place to live, with many landlords not renewing tenancies. If rushed and not thought through, planned changes to the way landlords can repossess properties risk making the situation even worse.
“Action is needed to stimulate supply with pro-growth taxation and a process for repossessing homes that is fair to all.”
Do you think that section 21’s demise will act as a catalyst for more landlords leaving the profession? Have you found a smaller buy-to-let sector impacting on the conveyancing sector?