Section 21s and repairs – are you prepared for the new rules?

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On 1 October 2015, a number of new pieces of legislation come into effect that will limit landlords’ powers to serve section 21 eviction notices.

Among the rules, which are laid out in the Deregulation Act 2015, is a subsection that states that failure to follow a prescribed repairs process can invalidate a section 21 notice, and also prevent further service of a section 21 for a six month period.

The rules are intended to prevent ‘retaliatory eviction’, a practice whereby landlords evict tenants in response to complaints about the condition or upkeep of their property.

Failure to correctly address complaints could be costly

Under section 33 of the Act, ‘preventing retaliatory eviction’, if you have been issued with an improvement notice or emergency remedial action notice by your local authority, you will be unable to issue a section 21 notice to your tenant for a period of six months.

In addition, you must follow a prescribed process for dealing with written complaints from your tenant. (Note: a complaint need not be in writing if your tenant does not know your email or postal address.) The process is as follows:

  • Within 14 days of receiving the complaint, you must provide an ‘adequate response’ (meaning a written response describing how you will address the complaint and provide a reasonable timeframe to take action).
  • If your tenant then complains to their local authority about the same or a substantially similar issue, and the local authority decides to issue a relevant notice, any section 21 notice you issued between the date of your tenant’s complaint and the date of the improvement notice will be invalid.

What this means in practice

Firstly, issuing a section 21 notice in response to a maintenance complaint from your tenant is no longer permissible by law.

In addition, any section 21 notice served after such a complaint will be invalid if your tenant took the complaint to the local housing authority, who proceeded to issue a repair notice.

As a repair notice rules out the service of any further eviction notices for the following six months, you are effectively unable to evict a tenant who has made and escalated a complaint unless the local authority decides not to issue a notice.

What if your tenant caused the damage?

There are a number of exemptions given in the new legislation. If a repair notice issued relates to disrepair caused by your tenant either breaching the terms of their tenancy agreement or by failing to use your property ‘in a tenant-link manner’, then you will still be able to issue a section 21 notice as normal.

Further exemptions: selling, right of sale and social housing providers

If your property is on the market

If your property is genuinely up for sale at the time you issue a section 21 notice, that notice will still be valid. Your property won’t count as being genuinely on the market if you intend to sell it, or your interest in it, to:

If your lender is exercising a power of sale

If your property is subject to a mortgage that was granted before the current tenancy began and your lender is exercising ‘power of sale’ as per section 101 of the Law of Property Act 1925 (http://www.legislation.gov.uk/ukpga/Geo5/15-16/20/section/101) in order to sell it with vacant possession, you will still be able to issue a section 21 notice to your tenants.

If you are a social housing provider

Private registered providers of social housing are not subject to the section 21 restrictions outlined in the first section of this article.

There are further changes to section 21 law

Section 21 notices now have an expiry date

Under section 36 of the Deregulation Act, section 21 notices are now no longer indefinite; you must begin possession proceedings within six months of serving notice.

You cannot issue a section 21 at the start of a tenancy

In addition, you cannot serve a section 21 within the first four months of a tenancy. If it is a replacement tenancy, you cannot serve notice within four months of the commencement date of the original tenancy.

New prescribed form and other requirements

There is a new prescribed section 21 form that you or your agent must use when giving notice to your tenant: http://www.legislation.gov.uk/ukpga/Geo5/15-16/20/section/101

You are required to issue your tenants with the new DCLG ‘How to Rent’ booklet at the start of each new tenancy: https://www.gov.uk/government/publications/how-to-rent

And if you don’t comply with existing energy performance certificate (EPC) and gas safety certificate requirements, any section 21 notice you issue will be invalid. This means that:

  • You must give your tenants an EPC at the start of each new tenancy, free of charge
  • You must have annual gas safety checks conducted by a Gas Safe registered engineer and give your tenant a record of the check, either within 28 days or, in the case of a new tenancy, before they move in

This makes it more important than ever to keep on top of your obligations and keep a record of the documents you send and receive. Also keep a record of each and every repair request and the steps you take to fulfil them; and if you delegate any or every aspect of your management, be sure that your agent is aware of these new rules and will do the same.

 

Written by Ben Gosling at Commercial Trust Limited


Posted by Ben Gosling, Commercial Trust on 30 September 2015

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