The UK rental market is set for dramatic change with the publication of the Renters' Rights Bill (the "Bill") introduced to the House of Commons on 11 September 2024. This landmark legislation proposes to abolish Section 21 evictions in England, thus bringing to a close an era of "no-fault" evictions which have been long considered a concern by tenants. This will apply to both new and existing tenancies.

I. What is Section 21?

Section 21 of the Housing Act 1988, often referred to as the "no-fault eviction" process, allows landlords to evict tenants without providing a reason. By issuing a Section 21 notice, landlords can end a tenancy agreement after the initial fixed term or during a periodic tenancy, provided they comply with the specific notice and procedural requirements. This mechanism has been criticised for creating insecurity for tenants, as it enables evictions without the need to justify the decision.

II. The Abolition of Section 21

The abolition of Section 21 marks a significant shift in tenant protection legislation. Under the new framework, landlords will no longer be able to use the no-fault eviction route to terminate tenancies. This change is designed to provide tenants with greater security and stability in their rental homes, reducing the risk of arbitrary or retaliatory evictions after the Act comes into force.

III. Changes to Section 8 Grounds for Possession

The abolition of Section 21 means landlords will have to revert to the grounds for possession under Section 8 when seeking to evict tenants. Section 8 requires landlords to rely on a specific legal reason, with the grounds classified as either mandatory or discretionary. The Bill makes several key changes to these grounds to ensure a fairer process for both parties.

Ground 1A (Sale of Property)

One of the significant updates is the introduction of Ground 1A, which allows landlords to seek possession if they intend to sell the property. However, the landlord can only use this ground if the tenancy has lasted for at least 12 months. Additionally, landlords will have to give tenants four months' notice of their intention to sell and provide evidence of the intended sale.

Ground 8 (Serious Rent Arrears)

Another critical change is to Ground 8, which concerns rent arrears. The Bill amends this ground so that landlords can only evict tenants if they have been in rent arrears for three months (increased from two months), both at the time the eviction notice is served and at the time of the court hearing.

Ground 4A (Student HMOs)

The Bill introduces a new mandatory ground for possession specifically for Houses in Multiple Occupation (HMOs), where all occupants are full-time students. This ground allows landlords to reclaim possession if they intend to relet the property to full-time students.

IV. Other Key Provisions

The Bill mandates a shift to periodic tenancies as the default model for all private rental agreements. This means that tenancies will no longer be fixed-term from the outset but will instead be rolling from the start. Tenants will not be able to give notice to leave until they have been in the property for at least four months, ensuring landlords are guaranteed six months' tenancy in total.

The Bill also includes new rules governing tenant requests to keep pets in rented properties. Landlords are required to respond to pet requests within 28 days and must provide a valid reason if they refuse.

V. Impact on Tenants and Landlords

The Renters' Rights Bill offers tenants increased security and protections. With the end of Section 21, tenants can no longer be evicted without cause, reducing the risk of sudden displacement.

On the other hand, landlords will face stricter requirements for evicting tenants, with the removal of Section 21 meaning they will have to rely on specific Section 8 grounds for possession. At LJ Legal Ltd, we believe these changes may discourage many landlords from staying in the market, especially given the added legal complexities and financial risks.