Landlord News

4 in 10 Landlords Considering Selling if Section 21 is Dropped

Andrew Truglia - June 20, 2019

Government proposals to scrap Section 21 repossessions have raised concerns amongst landlords, with many saying that they would consider selling their properties rather than take the potential risk of being stuck with a bad tenant.

In a survey carried out by Landlord Action, a leading housing law specialist, 33% of buy-to-let landlords said they would leave the rental market if the government removed Section 21 rules without providing a clear alternative. 38% of those surveyed said they would definitely consider selling up upon hearing the news.

The proposals, designed to increase the amount of long-term tenancies in the UK, could in fact have the opposite effect. The study goes on to find that 70% of landlords would be less willing to consider long-term tenancies if Section 21 was removed.

Whilst the measures are supposed to combat so-called rogue landlords: A small minority that have been abusing rules to unfairly evict tenants,

Paul Shamplina, founder of Landlord Action states: “If this was the case [that Section 21 was scrapped], the government’s efforts could end up being counter-productive and harming the most vulnerable tenants”

He believes that the proposals will reduce competition in the market by discouraging some landlords from the business, driving prices up, making renting even more difficult for lower income tenants.

Section 21 was initially introduced to attract private landlords to the sector, as a means of allowing them to vacate their property quickly if they had good reason to believe that their investment was at risk. It became a hot topic after a small minority of landlords used the rule to unfairly evict tenants but for the majority, it is merely a safety net against financial loss.

Shamplina says: “Remember, landlords want tenants, and good tenants at that, to stay in a property as long as possible. The vast majority of landlords would have no interest in evicting a tenant who respects their property and pays their rent on time.”

He states that long term tenancies make business sense, meeting the needs of the changing rental market and believes that the government should incentivise landlords to give tenants longer tenancies.

At the same time, a clear definition of what constitutes reasonable grounds for eviction must be enshrined into law in order to fill the void that the removal of Section 21 will create.