Lessons to be learned from Scotland’s reform of housing laws

Lessons to be learned from Scotland’s reform of housing laws

This article was published on: 11th March 2020

In December 2019, the Government announced its intention to introduce a Renters’ Reform Bill (“the Bill”) which aims to protect tenants in the residential rental market whilst still ensuring that the rights of the landlords are upheld to prevent a shortage of rented homes. One of the key aspects of this is the removal of section 21 of the Housing Act 1988.

The removal of the so called “no fault” evictions under section 21 would prevent landlords from terminating a fixed-term assured shorthold tenancy on or after the end of the term on two months’ notice without a reason, such as wanting to live there themselves or needing to sell it. It is expected that new grounds would be added to Schedule 2 of the Housing Act 1988 to accommodate this, allowing landlords to serve a section 8 notice in those circumstances instead.

The Government wants to ensure that everyone renting in the private section feels secure in their home. However, this proposed reform does not come without its issues, and this Bill has been met with heavy criticism from organisations representing the interests of landlords. Following its implementation, landlords would likely have to rely on section 8 of the Act in order to gain possession of their property. Although this provides an alternative to the “no fault” evictions, it is not known how a landlord could adequately prove to a court their genuine intention to (for example) sell a property, and how it would stop rogue landlords placing a property on the market simply to evict tenants.

Additional changes such as introducing a Housing Court and ensuring all grounds for possession are made mandatory are necessary to mitigate the impacts of the proposal.

The Government’s decision to abolish section 21 of the Housing Act comes two years after new rules were introduced in Scotland to ban no-fault evictions. It will be interesting to see if the new eviction rules in England and Wales will be as effective as those in Scotland, as it is argued that the Scottish government had already put more preparation in place than the English government.

Although not without landlords’ initial fears, following the change in the law, the rights of landlords in Scotland have been strengthened. Prior to the ban of non-fault evictions, the tenant must have been in at least three months in arrears before they could be served with a Notice to Quit, whereas now the notice period depends on the ground of eviction which were expanded to also include the landlords’ plans to sell or move into the property themselves.

Calls to introduce a Housing Court were also satisfied with the introduction of the first- tier Tribunal’s Housing and Property Chambers, where neither party needs representation. This aims to answer the demands for better access to justice for private landlords and an increase in transparency and consistency in the decision-making process.

The example of Scotland has shown that landlords can adapt well to the changes in the law. It will be interesting to see how effectively the Government will respond to the criticism.

The next steps remain uncertain as the Government will need to re-balance the system to ensure that the rights of tenants, as well as those of landlords, are protected. If such balance is not found, tenants could potentially be the most negatively affected by the removal of section 21, with there being a reduction in rental properties or increased rent charges.

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