Shelter blames Section 21 and rental reform delay for...

Michaela Anaka
11 May 2023 07:18 AM

Wow. So shelter don’t understand the effect of S24 taxation and the correlation between interest rate rises higher taxation and landlords selling up.
Section 21 will only be replaced by section 8 landlords will still sell and more tenants will be evicted under section 8 for arrears than ever before. Currently they’re evicted under s21 because it’s faster.
Shelters interference in thePRS has now come to a head the acute shortage of property will escalate them into a housing crisis of the largest magnitude since war times. Rather than going forward the war on the PRS has left the sector extremely short of properties as landlords leave in their droves and shelters lack of focus on social housing shortage and the governments reluctance to address this issue has left a very very serious issue of homelessness in the uk a void the PRS used to fill.
Scrapping s21 will do nothing to stop landlords exiting. That’s why there’s a shortage.

John McKay
11 May 2023 08:05 AM

Shelter understands the effects of S24 very well Michaela. They just choose to indicate something else.

Barry X
12 May 2023 15:38 PM

@MA - sorry I wasn't able to comment sooner but I was in hospital all day yesterday.

You put it really well and made several excellent points.

Technically speaking s.21 won't be replaced by s.8... we already have s.8 which has proven over the years to be virtually useless as it requires landlords to PROVE the tenant is a fault - which can be really hard as the legal requirements for proof are often elusive even if common sense immediately shows the tenants are seriously and/or chronically in default. Then, even if you somehow prove to the satisfaction of a strongly pro-tenant and anti-landlord judge that the tenant is in default the judge will usually give the tenant an opportunity to "remedy" the breach at leisure over many months, e.g. if they have serious rental arears then all the tenant has to do is plead poverty at the same time as a terror for "losing their home" and the judge will let them "try to catch up" by paying, say, £50 extra for the next 3 years... which of course they won't and you'll have a huge amount of work in trying to track and monitor it all and then attempt to get them back in court somehow if after continuing to then live rent free in your increasingly damaged flat they then don't simply disappear when it suits them and you have a "total loss" plus all the costs and misery on top... believe me, I've tried it (but years ago when the courts were still SLIGHTLY less dysfunctional and running months or even years behind schedule)... or the tenant can simply say they "didn't realise it was a serious matter and they need to take advice" in which case the judge will simply adjourn the case to "give them time to take advice" and it will go to the back of the growing queue and not have a chance of making it to another hearing for many months...

Its all absolutely horrible and the only possible way you can usually manage as a landlord is with a *mandatory* judgement which only the s.21 can provide... which is the exact reason why it was introduced in the first place. Before it, and without it, the PRS simply cannot function properly and all tenants are effectively "sitting tenants", paying rent and/or looking after the property is optional and there is nothing in practice that the landlord can usually do - at least not legally!

It's not just that the s.21 is faster (although obviously it is) but because it is supposed to be simple and mandatory - although it has been hugely undermined with unnecessary and irrelevant red-tape in recent years, .e.g. you have to prove you gave the tenant(s) the correct version of the total-B.S. "how to rent" leaflet and things...

without the right to a mandatory possession there is a lot of uncertainty and risk. Arguments, and trying to "prove" things, take time and cost money.

Instead of caring about genuine homeless people - which is what you would have wrongly thought a charity like Shelter was all about - these days, and for quite a few years now, they are nothing but a hard-left political lobbying outfit that generates huge amounts of money (for which it pays virtually no tax because it pretends to be a charity) from gullible who think they are supporting a "cause" to "take on rich landlords" who are always portrayed as being "rogues" who "exploit" our tenants and then on an evil whim decide to make them "homeless" with a "no fault eviction" that shelter pretends will automatically "make them homeless" in exactly 2 months.... when in reality it typically takes at least 3 - 6 months (plenty of time and warning to find somewhere to move to) and I've never once, in 26 years of being a landlord, heard of anyone ending up genuinely "homeless" as a result - in the very worst case (which believe me is rare) they might end up in council funded accommodation because they really have no income and are broke - but if so then why should we be required to house them for free for ever as that is not our responsibility or job!

I 100% agree with you that scrapping the s.21 will do nothing to stop landlords exiting - I'd go further and say, actually, it will ENCOURAGE more to give up and quite rightly so! I bet that as soon as the s.21 is eventually officially abolished (as seems certain) there will be a count-down period during which large numbers of s.21 will be served (including very possibly by me) while its still just about possible... so abolishing them will LEAD to evictions and "homelessness"!!!

Anyhow, sorry for all these words of frustration - we seem to be in 100% agreement and unfortunately there doesn't seem to be any way the government will back down or see sense.... and then it will get worse when they fail to cling on to power (as they are so useless) and Labour is inflicted on us instead :(

James Scollard
11 May 2023 07:42 AM

Why do they call it ‘no fault’ eviction. There is always a reason.
If a landlord has good tenants, they want to keep them, most landlords don’t increase rents with good tenants, like they should.
Tenants that don’t pay the rent or look after the property, get served. Guest what lesson is learnt here? Or, landlords that want to sell their property (which will still be in a section 8 notice anyway) … Pointless lobbying making it worse for tenants #shelter

John McKay
11 May 2023 08:02 AM

James, Shelter has an agenda. It just isn't what people think it is. One of their sponsors is/was Legal & General and the 'charity' even stated that the company 'collaborates' with them on policy.

L&G are a massive residential landlord and being a corporate will not be affected by Osborne's S24. There are links between Osborne and corporate housing providers too.

So how would a large corporate landlord view a reduction in competition and subsequent increases in rents???

Tony Sinclair
11 May 2023 09:51 AM

I am a responsible landlord who built all my properties from new and maintain them well. However costs to maintain my properties have risen dramatically in recent years in the form of all new tenant find fees paid for by the landlord, EICR reports, Fire requirements, Health and Safety, Alarm Testing, EPC's, Gas Safety Checks, Fire Risk Assessments et al. Even in good times return on assets employed was barely 4% gross and possibly 2% net at best, whereas I can stick my money in the bank now and get 4.5% completely hassle free. I have to fight to get £20 or £30 a month increase in rents every 12 months, absorb non payers, and most recently fund the damage caused by a tenant who deliberately left the taps on and flooded his flat and others when reluctantly exiting post a Section 21 notice we served because we needed to completely renovate the property back to new. Too much one sided bullocks is talked about the suffering of renters - what about abused landlords who constantly battle to find good tennis, battle with bad ones, and barely make enough money to make it worthwhile at all??

Tony A
12 May 2023 12:21 PM

Just checking: are you comparing like with like here? 2% net rental yield on your house's value is not comparable with 4.5% bank interest on the capital embedded in a mortgaged property, because the denominators are different.

Annoyed Landlord
11 May 2023 10:43 AM

If Polly Bleat needs to find a cause of homelessness, she just needs to look in a mirror to find one reason. Her attacks on landlords wishing to regain possession of their property, it is NOT an eviction, Polly and you KNOW it, have resulted in this unconservative government wanting to scrap S21. That worries landlords.

Being taxed on turnover rather than profits, unlike any other business, doesn’t exactly help. Landlords are selling up to avoid the rush should Sir Kneel get into power.

Kieran Ryan
11 May 2023 11:20 AM

shelter should be ashamed of themselves! They dont live in a real world! Landlords are losing money hand over fist due to goverment intervention on taxing them, if its not viable then sell. if they are homeless then its the governments fault, and they cant house them??

Kristjan Byfield
11 May 2023 12:09 PM

What has to be asked here, is what real changes will the RRB proposals really make.....

Will Landlords still be able to make rent increases in line with market conditions- yes
Will Landlords still be able to sell- yes
Will Landlords still be able to move into a property they own- yes
Will some Landlords leave the sector as a result of the changes- yes
Will any of the changes increase the courts backlog- yes

Will any of the proposals improve stock/supply- no
Will any of the proposals cap/control rents- no
Will any of the changes reduce the costs faced by landlords- no
Will any of the changes fund better enforcement of regulations and standards- no

Exactly how, then, do Shelter think these changes will improve the market for tenants? The general consensus is that, whilst standards may improve, the primary issues of supply and cost will worsen.

Tony A
12 May 2023 12:16 PM

As usual there's never a word in the S21 debate about houseshares. Mostly my HMO (a term I hate) tenants rub along together fine, but once in a while there's a dispute which the parties refuse to compromise over - a stray kitten brought into the house without me knowing and scratching the furniture, peeing everywhere and inflaming a tenant's asthma, or arguments over cleaning up, fridge space etc and it escalates to fights, note posting, screaming matches, the police called and so on. I try to mediate but someone - me - has to break the deadlock and use a Section 21 to give the guiltiest party notice, because life has become entrenched and intolerable for everyone. What am I supposed to do once S21 is abolished? I get seen as the bad guy because the tenants can't behave like grownups and I'm the one paying the costs of their intolerance. HMO landlords are already demonised, so I am seriously considering joining the exodus and exiting the sector.

Barry X
12 May 2023 15:41 PM

all excellent points, @AA... well said.