Whilst the renters reform bill has been thrown away, we don’t doubt that the incoming government will resurrect it in some form and with that proceed to ban section 21 evictions in favour of a beefed-up section 8 process.
Recent data shows that evictions by bailiffs in England via a Section 21 ‘no fault’ eviction increased by 19% during the first three months of the year to 2,682 households. That’s a notable rise!
We have been reading a couple of articles however, that show a correlation between an increase in section 21 evictions and rent arrears. For example, data for Q1 2024 highlights how rent arrears increased by 27% (up from £1,816 to £1,435) compared to Q1 2023. This level of arrears is the highest figure ever recorded.
When it comes to mortgages, the level of arrears is also up for Q1 in what shows to be a worrying trend as the reality of rate increases continues to bite. Increased mortgage payments coupled with a cost-of-living crisis squeezing tenants often puts landlords in a challenging position.
Looking at some interesting data from Propertymark (this is a snapshot as it’s from 2021), the reason that 46% of landlords end a tenancy is due to rent arrears, closely followed by tenants not looking after the property and then anti-social behaviour.
The data below is extremely interesting as it does not paint the picture of rogue landlords just kicking tenants out for no reason that many campaigners would have us believe.
Why tenants leave properties*
- 47% gave notice to end their periodic tenancy
- 30% decided not to renew their tenancy
- 16% moved out before the end of their tenancy
- 6% were asked to leave
- 3% were evicted
- 3% landlord decided not to renew the tenancy
Why landlords/agents seek to evict tenants*
- 46% tenant in rent arrears
- 39% because the property was not cared for
- 32% tenant engaged in anti-social behaviour
- 25% to sell the property
- 13% to refurbish and re-let it
- 7% tenant had too many complaints
*Propertymark data from 2021
Why use section 21 for rent arrears?
You might have spotted an interesting point here and that’s why you would use a section 21 for rental arrears. This is an extremely good question!
As we're sure you know, a section 8 eviction requires tenants to be at least two months in arrears (or have breached their tenancy), whereas a section 21 notice is more commonly used for a ‘no fault’ eviction.
A solicitor would be able to advise the best route to take of course, but a section 21 notice would commonly be used in relation to rental arrears where a tenant is paying but sporadically for example.
In addition, a section 21 may be the preferred route as the burden of proof is lower as there can be no argument and the outcome is more certain.
Landlord Action explain that a Section 21 notice might be preferred over a section 8 notice where:
“There are rent arrears, but the tenant does not have any assets or employment and there is no guarantor… you may never the recover the rent arrears, but you get the property back without a court hearing.”
What about the abolition of section 21?
The point here is that the abolition of section 21 should be seen as a ‘reform’ as section 8 powers will be strengthened. Landlords WILL be able to gain possession of their property, it will just be more of a legal process.
We found the graph below that’s very interesting as it shows how many households are in private rental accommodation across EU countries and the no fault eviction status. It’s interesting to see how the bottom third are those that allow no fault evictions in full, or in part!
It’s certainly interesting to see this data as it does somewhat change the perspective on what both sides of the media say.
What do you think to these statistics and have you experienced an increase in arrears from tenants?
