MPs warn Government risks undermining plans to ban ‘no fault’ evictions

The Levelling Up, Housing and Communities (LUHC) Committee has said that the Government risks undermining its own proposed tenancy reforms, including the banning of section 21 ‘no fault’ evictions, unless it fixes delays in the court system.

In a report published today (9 February), Reforming the Private Rented Sector, the cross-party group express concerns that the Government’s White Paper may have a negative impact on the student private rental sector (PRS) market, and highlight the threat to the PRS of the rise in holiday-lets.

The report warns that the Government’s proposed ‘sales and occupations grounds’ in the White Paper could be “too easily exploited by bad landlords and become a backdoor to no-fault evictions”.

The proposals in the White Paper include the abolition of section 21 and the replacement of fixed-term tenancies with open-ended tenancies (more often referred to as “periodic tenancies”).

On 21 July 2022, the Committee launched its inquiry into the proposals in the White Paper by issuing a call for evidence. It received and published 242 written submissions and held two oral evidence sessions.

The Committee recommends a series of changes to the sales and occupation grounds to help combat unfair eviction and insecurity of tenure.

The report states that it is “not clear whether the Government fully appreciates the extent to which an unreformed courts system could undermine its tenancy reforms”.

The LUHC committee recommends that the Government introduce a specialist housing court. It also recommends that the Government must:

• significantly increase the courts’ ability to process possession claims quickly and efficiently and in a way that is fair to both landlords and tenants;
• ensure the courts prioritise and fast-track all possession claims in respect of rent arrears and antisocial behaviour; and
• in consultation with landlords, agree how quickly the courts need to be processing such claims before landlords can have confidence in the system, and then commit to meeting this target before it repeals section 21.

The report notes: “A reasonable balance needs to be struck between security of tenure for tenants and a degree of certainty for landlords.

“We therefore recommend that tenants be unable to give two months’ notice to leave until they have been in a property for at least four months. This will give landlords the legal certainty of at least six months’ rent at the start of a tenancy.”

The report concludes that the proposed ‘sales and occupation grounds’ could be exploited by bad landlords and recommends the Government:

• increase from six months to one year the period at the start of a tenancy during which the landlord may not use either grounds; and
• increase from three months to six months the period following the use of either ground during which the landlord may not market or relet the property.

Whilst welcoming the Government’s proposed abolition of fixed-term tenancies, the committee warns against applying this to the general student private rented sector market.

The report notes that many submissions, particularly from landlords and letting agents, but also from some student unions, said the Government’s tenancy reforms would “deter landlords from letting to students and so undermine students’ ability to secure accommodation,” at a time when many university towns and cities are “already under-supplied” with student rental properties.

Landlords told the committee the sector would be “decimated” or “all but cease to exist.”

The report calls for the Government to retain fixed-term tenancies in the entire student housing sector but require all landlords letting to students to sign up to one of the existing government-approved codes of conduct.

The report welcomes the Government’s plans to introduce a legally binding decent homes standard (DHS), however, it points to a “series of obstacles” threatening the ability of local councils to enforce the standard, including “precarious local government finances”, “shortage of qualified enforcement staff”, and a “lack of reliable data”.

The report recommends the Government introduce a tougher civil penalties regime in the proposed renters reform bill to ensure councils have the capability to collect financial penalties on landlords who breach standards.

Clive Betts, Chair of the Levelling Up, Housing and Communities Committee, said: “By its own admission, the Government’s White Paper did not address the underlying cause of the affordability crisis in the private rented sector, namely the decades-long failure of successive Governments to build enough homes. 

“Only a significant increase in housing, particularly affordable housing, will ultimately tackle the rocketing costs of renting for many tenants. We call on the Government to recommit delivering the affordable homes the country needs, particularly the 90,000 social rent homes needed every year."

Betts added: “The Government should remedy the blight of unfair evictions and insecurity of tenure experienced by too many tenants today. From our inquiry, it’s not clear the Government fully appreciates that a creaking and unreformed courts system in England risks undermining their own tenancy reforms, including the welcome commitment to ban ‘no fault’ evictions.

“For landlords and tenants, it’s vital the Government now finds a practical way forward to enable courts to fast-track claims.”

The report concludes by reiterating that the success of the Government’s reforms depends to a great extent on “tenants knowing their rights, and on landlords knowing that they know them".

A Government spokesman said: “This government is absolutely committed to delivering a fairer deal for renters and welcome the work of the committee in this area.

“We will bring forward a Renters Reform Bill in this Parliament, abolishing ‘no fault evictions’ so that all tenants – including university students – have greater security in their homes and are empowered to challenge poor conditions and unreasonable rent rises.

“We are investing a significant amount of funding to improve waiting times in the civil courts, opening extra courtrooms and recruiting more judges, and will continue to engage with stakeholders across the private rented sector.”

Lottie Winson