The Government has now published its long-awaited white paper: ‘A fairer private rented sector‘. Much to absorb and significant change ahead. It is now clear these changes will cover both the private rented sector (PRS) and private registered providers (PRPs) in the social housing sector equally.
Those with long memories may remember a consultation in 2018 on the abolition of section 21 notices and it seemed at one point assured shorthold tenancies generally. There was then a further ‘new deal for renting’ consultation in July 2019 on the proposed plans to extend and vary the grounds for possession, abolish s21 notices and whether the reforms should extend to housing associations and providers of supported accommodation as well as the PRS. That commitment to abolish s21 notices was included in the December 2019 Conservative Party election manifesto but the plans were delayed as a result of the Covid-19 pandemic.
The responses to the consultation (of which there were 19,697!) have only just been published along with the white paper. The consultation response paper is where the detail of the plans for tenancies and possession proceedings can be found.
This ebriefing focuses on the key changes planned to tenancies and enforcement through possession proceedings.
The key headlines are as follows:
- Abolishing assured and assured shorthold fixed-term tenancies. All tenancies will become periodic. ‘There will not be any new mechanisms facilitating the creation of probationary, demoted and fixed-term tenancies for PRPs’. The intention instead is that the new and amended grounds for possession will cover all possible scenarios required. Will anyone notice the abolition of the now rarely used demoted tenancy?
- Tenants will need to give two months’ notice to leave but cannot be required to give more than two months’ notice.
- A written tenancy agreement will always be required, whether digital or a physical hard copy. ‘Proportionate penalties’ such as fines are being considered for non-compliance but they will not restrict possession if landlords fail to comply.
- Access for repairs. All written agreements must stipulate the tenant’s responsibility for keeping the property in good condition and allowing reasonable access for repairs. This is currently an implied obligation anyway but it will be helpful to require an express term. If a tenant denies access, ‘landlords have routes other than possession available to secure access such as applying to the court for an injunction’. Nothing new there. However, no mention of a right to force entry or a power for the court to order it, which is the biggest hurdle to actually getting access in practice. (The Building Safety Act may be the answer instead to obtain access to deal with compliance-related repairs).
- Helpfully, a promise to remove unnecessary rules which trip landlords up, which include the possession restrictions linked to section 21 and a requirement for prior notice in some grounds. The only restriction that will remain will be deposit protection. This means that the many pre-conditions when relying on a section 21 notice, to prove provision of an energy performance certificate (EPC) and a gas safety certificate and for private landlords the how to rent booklet at tenancy start date will no longer be required. The Government response indicates that there is insufficient evidence the restrictions are effective in improving standards in any event and they ‘just frustrate reasonable possession proceedings in court’. Those requirements remain but will just not be linked to possession proceedings.
Ending tenancies
A full list of new grounds for possession is proposed which is at annex A to the consultation response paper.
New grounds include:
- Sale of property – mandatory ground; notice period two months; cannot generally use in first six months of tenancy. No prior notice of the ground will be required. Landlords will be prohibited from reletting within three months.
- Temporary accommodation – only for landlords providing accommodation to meet a local authority’s main housing duty, when the tenancy is no longer required by the local authority. Mandatory ground. One month’s notice.
- Supported housing – restricted to support housing providers. Where the home was intended to be short-term; funding has ended or been changed; support is no longer meeting the tenant’s needs or there have been significant changes to a shared housing arrangement and closure or reconfiguration is required. Notice period four weeks. Mandatory ground.
- Supported housing – also restricted to support housing providers. Where the tenant is not engaging with support. Notice period four weeks. Discretionary ground.
- Repeated arrears ground – Tenant in at least two months arrears at least three times in the past three years. Notice period four weeks. Mandatory ground (note the current ground eight mandatory ground remains as well).
Amended grounds include:
- Demolition/redevelopment – cannot use in first six months; PRPs must pay reasonable moving costs; the restriction on landlords who purchase a property after a tenancy began not being able to use the redevelopment ground will be removed. Unhelpfully and rather surprisingly though is the proposal ‘social landlords cannot use the ground unless redevelopment is required by a superior landlord’. Why? This will be a significant obstacle to development schemes arising from a social landlord’s own improvement plans.
- Mandatory ASB ground – notice period will reduce to two weeks; the current five conditions remain the same.
- Discretionary rent arrears – no change but the notice period increases from two to four weeks.
- Tenant has died and tenancy has been ‘inherited’. This is the current ground seven. Helpfully the 12-month time limit will be extended to 24 months recognising the time it can take to establish whether a new tenant is entitled to succeed.
A specific abandonment ground for possession has been ruled out as being too complex. The previous abandonment provisions in the 2016 Housing and Planning Act which were never enacted are going to be repealed. The Government suggests landlords should simply use the rent arrears grounds in abandonment scenarios.
A small note on shared ownership leases which are currently legally treated as being assured shorthold tenancies for possession purposes. There is simply a promise to ‘consider whether legislative measures are needed’ Presumably a reference to requiring forfeiture like leases rather than possession proceedings designed for tenants. One to watch.
Possession procedure changes
- What of the much discussed ‘housing court’? The Government has also published its response to its 2018 call for evidence on a housing court.
- The responses received ‘indicated that introducing a housing court would not address the underlying issues which were raised by court users, which included the timeliness of cases, resourcing, access to legal aid (particularly for those in receipt of benefits) and the provision of information and advice’.
- Paper consideration or court hearings? Having considered whether to extend the accelerated possession procedure currently used in s21 proceedings to all cases, it has been decided on balance that it is important the tenant has the opportunity to attend a hearing and the plan is to instead ‘pursue other means to expedite the court process’.
- A review of the time taken for first possession hearings to be listed by courts for anti-social behaviour, supported accommodation and temporary accommodation grounds, will be undertaken with the Ministry of Justice and subject to further possible consultation.
Implementation
Timescales are not yet clear, just a short mention of ensuring these changes are in place by 2030, so we are looking medium-term.
A two-stage process is proposed. Firstly, there will be at least six months’ notice of the first implementation date after which all new tenancies will be periodic and governed by the new rules.
The second implementation date, which will be at least 12 months later, will see all existing tenancies transition to the new system.
Comment
The significant impact of the extent of these changes on the social housing and private rented sector cannot be understated. Some current models will need careful thought. We have considerable change ahead!
For more information
If you would like to find out more about the white paper please contact Helen Tucker, a partner in the housing litigation and management team.