Landlords have had a long period of successful lettings both under the Housing Act 1980, the Housing Act 1988 and the amendments introduced with the Housing Act 1996. Several tenant groups have protested loudly; government has listened and so the law has changed with regard to gaining possession of a property let under an Assured Shorthold Tenancy.
Sadly many landlords and agents haven’t taken on board the new regulations, which were introduced under the Deregulation Act 2015.
New tenancies fall under this legislation and from October 2018 all tenancies, however old, will have to comply.
There are dangers with letting a property and these must be recognised early on otherwise under today’s legislation, one could find it very difficult to obtain vacant possession of a property.
Actually letting a property is the easy part; indeed in law one doesn’t even need a written tenancy agreement. If the tenant meets certain criteria laid down by the Housing Act 1988 i.e. a) is an individual(s) b) uses the property as his sole or principle home c) pays less than £100,00 pa in rent and d) the landlord is not deemed to be a resident landlord, then once that person is in occupation of the property they will automatically have an AST.
To regain vacant possession of a property most agents and landlords are aware that they must serve notice under Section 21 of the Housing Act 1988 as amended.
The landlord must give the tenant a minimum of two months’ notice to vacate the property. Previously there were rules regarding the end date of this notice, particularly when the tenancy had become statutory periodic i.e. it has continued beyond its agreed fixed term without being renewed or extended.
The rules have been simplified and now the notice can expire on any date as long as it is a) after the end of the fixed term or b) by use of a break clause written into the tenancy agreement. The notice, however, may now not be served until four months of the tenancy have elapsed – this in effect will lengthen the tenancy by a minimum of a day (if a six month tenancy).
The Section 21 Notice is now a prescribed notice. This means that one must use the correct notice or it will be invalid. Previously one could create one’s own notice or even put such notice in letter format.
Generally agents and landlords have also been aware that they must a) give the tenant a valid EPC for the property prior to moving in b) give the tenant a valid gas safety record prior to moving into the property c) ensure that the property has smoke and carbon monoxide detectors where required d) give the tenant the current version of the government ‘How to Rent’ Guide e) ensure that the deposit is protected by one of the government approved schemes f) provide the tenant with prescribed information relating to the deposit plus a leaflet detailing the scheme and g) obtain a licence for an HMO if required.
Whilst this information may be known, what perhaps is not fully understood is that if any of these things have not been complied with within the correct time frame service of a Section 21 Notice will be invalid. Cases brought before the courts have failed because of ignorance of these rules.
One such case was where a landlord thought she was ‘protecting’ the deposit by placing it in a secure deposit account in the bank. Her possession case failed; she then had to protect the deposit properly and serve a new notice thereby extending the tenancy by a further two months. Plus the tenant was then in a position to take the landlord to court to claim three times the deposit as the penalty for not protecting the deposit in the first place – an expensive mistake.
There was also never clarity over when the notice could be used. Did it have a life like Section 8 notices which expire after 12 months? If a tenant didn’t leave on the proposed date could one wait several months before taking a tenant to court? This has been clarified and indeed a Section 21 notice must now be used within six months of the date stated in the notice or it will become invalid.
It is also proposed to completely remove the rights of landlords to serve a ‘no fault’ Section 21 notice. This suggestion worries me greatly. I lived and worked through the days of the Rent Acts when one dare not let a property (other than one’s own home) for fear of creating a protected tenancy and having a sitting tenant with a ‘fair rent’. The Housing Act 1980 and 1988 changed all that. The market opened up, landlords invested, companies invested, developers invested and we now have a thriving letting industry. Yes, rents in some areas are very high and this can and does create severe problems for those unable to meet those rents but let us find other solutions to those problems. Do not let us return to those dark days again.