Section 21 Evictions Debate
Full Debate: Read Full DebateKaren Buck
Main Page: Karen Buck (Labour - Westminster North)Department Debates - View all Karen Buck's debates with the Ministry of Housing, Communities and Local Government
(6 years ago)
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I beg to move,
That this House has considered the use of Section 21 evictions in the private rented sector.
It is a pleasure to open this debate under your chairmanship, Mr Hollobone, and to do so in the presence of the Minister. I know that she is responding to a debate on the private rented sector for the second time in two weeks. I apologise for that, but I think it reflects the extent of concern about some of the issues in this rapidly growing housing sector.
This debate is the culmination of a campaign that has been run on behalf of a number of organisations working with private tenants, including Generation Rent most specifically, the London Renters Union, the New Economics Foundation and ACORN, which run the End Unfair Evictions campaign and have encouraged people to speak up about their experiences. The social media presence on the issue demonstrated some quite extraordinary experiences that tenants have had with homelessness and insecurity as a result of the use of a section 21 notice.
The campaign has also received backing from Children England, Independent Age, Age UK London, Crisis, the Salvation Army, Mind, Z2K and Shelter, which gave us a very good briefing on the issue. More than 50,000 people signed a petition calling on the Government to give renters more stability and certainty in their homes by abolishing section 21, which gave us the opportunity to have the debate. The petition ran for 10 weeks and was handed to the Secretary of State for Housing, Communities and Local Government at the end of August.
What is section 21, and why are we specifically concerned about it? Most private and some social tenants now live in assured shorthold tenancies. In order to bring those tenancies to an end, landlords have two options: section 8, which enables a landlord to regain possession before the end of a tenancy on one or more of several different grounds, or section 21, for which the landlord must give two months’ notice of the intention to seek possession. On the expiry of that notice period, the tenancy is not ended, but the landlord can bring accelerated possession proceedings based on the section 21 notice. Unless there is a defence, which can only be that the notice is not valid, the courts must then grant a possession order. If the tenant does not leave, the landlord can seek a warrant of possession and a bailiff’s appointment for eviction.
Section 21 notices cannot be served under specified circumstances, such as when a deposit has not been protected, if the landlord does not have a required licence, after the issuing of a council improvement notice or if the landlord has failed to provide a valid energy certificate, gas safety certificate or a “How to Rent” guide.
My hon. Friend is making an excellent speech. I have many private renters in my constituency and one issue that they bring up with me about section 21 is revenge evictions. Is that also a concern of hers?
It is very much a concern. I will come on to retaliatory evictions in a minute when I talk about why we are concerned about the use of section 21 and the balancing alternatives.
Abolishing section 21, which my remarks are aimed at, would, in practice, make fixed-term tenancies irrelevant. I know that the Government are also interested in, and have consulted on, longer tenancies, in order to provide greater security in the private rented sector. Although I am sympathetic to that idea, I am increasingly of the view that, rather than adopt an arbitrary target for the length of tenancies, we should change the framework completely and ensure that the default is a longer tenancy, unless and until the landlord has a legitimate need to recover the property or if there is a fault on the part of the tenant. However, as I will remark later, that must be balanced with other changes that meet the legitimate concerns of landlords.
Why do we need to change this framework? A Conservative Government introduced section 21 of the Housing Act 1988 as part of a deregulatory approach to the housing sector, at a time when the private rented sector was in a very different place from now. It had been in long-term decline over a great many decades, and the Government felt that deregulation would be one way to boost it. Indeed, the sector has been utterly transformed from the landscape we saw 30 years ago, doubling to 4.7 million households. That is by no means solely the result of deregulation; the obvious decline in the social housing sector and the crisis in the affordability of home ownership are also important factors.
The sector also now has a very different profile, compared with a few decades ago. For many of us, renting was a transitional housing tenure. When starting out in life, many of us rented privately—I certainly did for several years—but often on the way to home ownership. Very few of us, particularly those who were bringing up families, expected or wanted to be in the private rented sector for life. However, we are now seeing a change in that profile, with four in 10 private renters now families with children. The recent Rugg review demonstrated that the private rented sector is also home to a growing proportion of highly vulnerable tenants who have been discharged into the private rented sector who would previously have been accommodated through the homelessness route. We are also seeing, inevitably, an increase in the number of older tenants who expect to live out their retirement in the private rented sector, which was extremely unusual at the time of the 1988 Act.
If the sector has changed beyond recognition, policy towards it must also change, to address some of the unforeseen consequences of those developments and to make sure that the sector works well and fairly for both tenants and landlords. A healthy rental sector is important for the housing mix, and it is important to acknowledge its flexibility, often as a starter accommodation. It is also absolutely essential to recognise that most landlords are good and responsible and provide a decent quality of accommodation.
My hon. Friend is right that most landlords are responsible, but that is not really the point. The point is that the 1988 Act, and section 21 in particular, allowed housing to become a commodity. Landlords can simply treat it as an asset to be traded and sold to increase their profits or income. Housing has no structure as a home under that Act. That is the basic flaw.
That is absolutely right. It is important to address the points from landlords. Having seen some of the concerns expressed by landlords in the social media commentary in the build-up to the debate, and having spoken at the Residential Landlords Association conference and at other conferences, one hears from landlords that they feel unfairly treated and tarred with the same brush as the rogue minority, which I think is probably fair. Unfortunately, the rogue minority bring down the sector as a whole. However, addressing section 21 is not about the behaviour of the small minority; it is about recognising that there is now a structural imbalance in tenancies that unexpectedly provide long-term homes for a much wider spectrum of society than was previously the case.
Is it not true that we want to make sure that good landlords remain good landlords? This change is not against them. If they do the right thing, they should not be afraid of what we propose.
It is absolutely true that good landlords should have no reason to fear a change in policy that reflects the differences in the demography of the sector, but I know that some do. It is also fair to say that the minority of landlords, whether we are talking about housing conditions—I acknowledge the Minister’s consensual approach to the Homes (Fitness for Human Habitation) Bill—or security of tenure, bring down the reputation of the sector as a whole, which needs to be addressed.
Some of the better landlords may not have among their number the person who posted on social media before the debate:
“We need to fight to protect section 21…2 months is plenty to find a new rental…although if a tenant has annoyed me I wait to pull the trigger in mid-November to screw up their Christmas”.
That is not the behaviour of the overwhelming majority of landlords, but it is certainly not helpful to their wider reputation.
I thank my hon. Friend for her excellent speech. Does she agree that section 21 evictions can upset the stability of family life? My constituent was forced to move to a different area because her tenancy came to an end, upsetting her caring and family arrangements.
That point is absolutely central to the argument, and I will come to it in a minute.
On the point about the behaviour of a minority of landlords not doing a great deal for the cause of the majority, there was also on social media the letting agent who said in respect of the payment of a tenant’s renewal fees:
“As far as I can see if the tenant doesn’t pay the renewal fee, DON’T renew the tenancy. Simples… You could always serve S21 and replace them.”
That cavalier attitude to security of tenure is completely unacceptable, but we have a legislative framework that allows a number of landlords to behave in that way. I say to people who are doing that, “Guys, you are really not helping your own cause or the cause of the business sector for private rented tenure, and I would advise you to think very carefully about the way you express yourselves.”
What has happened to the use of section 21 over time, and why do we need to consider our longer term approach? It is extremely hard to obtain accurate information from landlords about their use of section 21 notices, and the large majority of tenants who leave assured shorthold tenancies do so after the service of a notice without court proceedings. I think that in the private rented sector debate last week the hon. Member for Harrow East (Bob Blackman) said—I believe this to be true, and have seen anecdotal evidence that it is true—that there are landlords who issue section 21s routinely at the end of a six-month period in order to be prepared for exercising those rights at the end of 12 months. That builds in to tenants’ experience instability of exactly the kind that hon. Members have mentioned today.
The actual number of section 21 notices served is unknowable. However, we know that in 2017 there were 21,439 possession claims under both section 8 and section 21 and 6,260 actual possessions, and a further 29,601 claims and 12,953 possessions under the accelerated procedure. That is a lot of uses of section 21.
We also know from Government homelessness statistics that the ending of a private tenancy on a no-fault basis has become the single largest cause of homelessness, currently representing more than half of all homelessness applications. That is critical. An analysis by Generation Rent claims that 92% of the rise in homelessness cases caused by the end of a private tenancy in London, which of course has the largest share, regionally, of national homelessness cases, can be explained by no-fault evictions. The figure is only slightly lower—88%—outside the capital.
The major trauma, of course, is for the tenants being evicted, but there is also an impact on local authorities, because if a landlord is using the section 21 process—often the notices are served at the beginning of the tenancy as protective notices—they are simply using it as a way of regulating their business, knowing that if the tenant is in priority need, they will be picked up in some way by the local authority, which obviously puts additional costs on the taxpayer.
Of course it does. As we have been discussing in the context of the Homelessness Reduction Act 2017, local authorities, because of the sheer pressure of homelessness applications, are also expecting tenants to wait until the court order has been issued and to wait until the bailiffs have been instructed and a date for the bailiffs to arrive has been received before they will consider the homelessness application. Landlords hate that, and one can understand exactly why—because of the insecurity about what happens to their rental payments. But the tenants absolutely loathe it and find it wholly traumatic to have to wait, often with their children, for the bailiffs to turn up before they can be rehoused by the local authority.
Research by the Joseph Rowntree Foundation last year found that the number of private tenants being evicted had risen by one fifth, that the overwhelming majority of the increase in possessions was driven by section 21, and that that was highly concentrated, with four out of five such repossessions being in London and the south-east, where rents are highest. It is precisely that concentration of section 21 use in certain areas correlating with the areas where market rents have risen most rapidly that I think is a real cause for concern.
The London boroughs identified by the Joseph Rowntree Foundation were all in the top 10 for the largest and fastest market rent increases from an initially low level. Although correlation must be treated cautiously, it is hard not to conclude that there is causation between increases in market rent levels and the use of section 21, whether that involves evicting tenants in rent arrears because of high rent levels, or evicting tenants in order to raise rents.
If anything, the flattening off of possession claims over the period 2015 to 2017—that has flattened from a period when it rose very steeply—has happened at a time when the private rental market has been under pressure from several other directions. It tends to reinforce the point that section 21 use reflects wider trends in relation to rents and that, crucially, we cannot stop worrying about it because there has been something of a flattening off in the last couple of years. If anything, now is the moment when we need to review the law, because if rents start picking up again, as over the longer term they almost certainly will, we will find that there will be a further acceleration in its use.
The Residential Landlords Association makes the case that its research shows that in half of all places where section 21 notices are served, that is because there is an alleged fault, such as rent arrears, but that argument is somewhat undermined by the local authority homelessness experience, because local authority acceptances of people who have been evicted from the private rented sector will happen only after there has been an inquiry into the cause of homelessness and it has been found that the homelessness is not a result of fault on the part of the tenant.
Homelessness is therefore a major factor in our wanting to reconsider the use of section 21, but it is of course only the sharp end of a much wider experience of insecurity. Unchosen ends of tenancies are disruptive, expensive and often traumatic for those involved. Having to make frequent moves, especially for families with children and for vulnerable and older tenants, is a deeply negative experience, even when it has not been imposed by a court order.
Shelter estimates that 27% of renters with children have moved three or more times in the past five years. That takes a toll on physical and mental wellbeing and on educational achievement. It also undermines communities and civic engagement. A very powerful case was made a few years ago by the Electoral Commission on the impact of high turnover and churn in the private rented sector. I know from my own casework, as I am sure all hon. Members do, just how distressing parents—it is not only parents, but it is parents in particular—find it to have to move around, changing schools and disrupting support networks. I could have chosen dozens of cases from my own case load to illustrate that point, but I have chosen the details of just one to read out— it is only a few paragraphs—with your permission, Mr Hollobone.
My constituent says:
“I have lived in this area for over 30 years. Due to overcrowding in our family home I was asked to leave in 2010, at which point I made a housing application to”
the local authority. They continue:
“The Council accepted a…duty and provided us with temporary accommodation in East London. We stayed in Dagenham for a short while before being lured back to Westminster by the Private Sector Team, reassuring us that this was a better option…When we signed a private tenancy we were promptly notified that the council has discharged its duty towards us because we have accepted private rent. We only rented for a year before the Housing Benefit was reduced under the new welfare reforms. As we could no longer afford the rent, we were obliged to find alternative accommodation”.
Despite their need for three-bedroom accommodation, they moved into two-bedroom accommodation. The council said that it
“could not and would not help us. I have a local connection as I have my family here. I look after my elderly father”,
who has cancer.
“I have 3 dependent children…attending local schools. I sit on the board of governors and play an active role in the…running of the school. I am…a member of the Parent Council.”
My constituent says that they are
“employed…and have served 18 years”
in their job in the local area. They say they have been served another
“Section 21 Notice by the landlords Agents requiring possession of the flat on 02nd October.”
That will be the family’s fifth move in eight years. It is a simple example. It involves no fault, no arrears, no bad behaviour on the part of the tenants, but an imposed move of a vulnerable local family, and it is only too typical.
Renting privately is overall less secure than other tenures. Some 860,000 tenants moved between private rentals in 2016, up from 465,000 20 years ago, and one in 10 movers said that their move was down to being given notice by their landlord.
My hon. Friend the Member for Leeds North West (Alex Sobel) talked about retaliatory eviction. A significant minority of tenants fear retaliatory eviction if they make a complaint and so may be deterred from pursuing their rights for fear of the consequences. That unfortunately undermines efforts to improve standards in the private rented sector, despite its having, of all tenures, the highest level of substandard accommodation.
The hon. Lady is making a powerful speech, and the examples she is giving emphasise why it is important to re-examine the balance in this area; she has made that argument powerfully. Has she made any assessment of what the potential impact could be on the pipeline of available housing? I am always mindful in this place of the law of unintended consequences. I would be interested to hear her thoughts on that.
It is a fair point. As always, a balance has to be struck. The private rented sector is important, and as much as we would like to build more social housing to accommodate some of the people in it, that would take longer than we can afford to take to accommodate the people in the pipeline. That has to be considered. It is fundamentally unknowable, because it cannot be taken out of the context of so many other aspects of housing need and supply, including the Government’s 2015 tax changes, which landlords are extremely concerned about, and the overall number of tenants seeking accommodation.
The fact is that if we get the balance right and remove no-fault from the equation, and if we concentrate on providing a means for landlords who legitimately need to recover their property for whatever reason and deal with some of their concerns about the operation of that system, there is no reason on earth people should regard that as unacceptable.
I know that it is unusual to make an intervention from the Front Bench, but the situation that the hon. Member for Cheltenham (Alex Chalk) describes is simply one of displacement, which would not solve the long waiting lists that people are experiencing for social housing and affordable housing, and would not give anybody security of tenure. The issue he describes is not the equivalent of bed-blocking.
To add to that interesting argument, section 21 has been abolished in Scotland, which is a different jurisdiction and a different housing market, and has been replaced by a regime in which there are mandatory and discretionary grounds for possession. As I understand it, the objections from many landlords are about the complexity and the expense of the court process as much as anything. It is quite a difficult argument to put forward—although I am sure that the hon. Member for Cheltenham (Alex Chalk) would do it well—that it is simply too difficult for landlords and it should be unrestricted for that reason.
I am grateful to my hon. Friend for that point. Certainly the landlord associations and landlords make the argument that the court process takes too long and is too complicated and, in many cases, too expensive for them to operate. I am unconvinced by that argument, because the figures that the landlord associations have put forward for the period of waiting for a court date or until a warrant can be issued are significantly different from the figures that the Library has provided for the debate. I am not sure that the associations are not using a different definition of average to make their case.
Obviously, once a landlord has decided that they want to recover a property, they will want to do so as quickly as possibly—that is inevitable—but whether the period that landlords have to wait and the quality of evidence that they have to provide if they are seeking a fault-based eviction should be lowered to make it easier for them, to the point where it effectively allows them to act without due regard for the rights of tenants, is a highly moot point.
I am entirely persuaded that landlords who issue a notice in a cynical, cruel and egregious way—in an almost deliberately upsetting way—should not be in a position to do so. The difficulty is in what an appropriate pretext or legitimate reason to seek to end a tenancy is. Can the hon. Lady say more about how she would crystallise and identify what amounts to a good cause?
As my hon. Friend the Member for Hammersmith (Andy Slaughter) said, there is the experience of Scotland. It is early days, because the Scottish changes took effect only last year, but they give us some guidance as to how it might be possible to move forward. It will be good to see how it works when we start to get some figures.
Clearly, where landlords have a legitimate wish to recover the property, because they wish to live in it or make use of it—if it is a landlord’s home and they wish to return to it—that would clearly be a ground. There has to be some guard against that being open to abuse, however, which seems to be the case from some anecdotal evidence in the Scottish experience.
There are also fault-based grounds, such as where a tenant commits antisocial behaviour or is in rent arrears. There are grounds—that work has already been done—and it is completely reasonable that they should be allowed to exist and that, when a landlord takes a claim forward, it should be reasonably expeditious for them to pursue it.
The Government are consulting on the housing court, which I have mixed views about. It is important that tenants should have their interests represented and be legally aided in doing so, but there are questions about how that might operate, so the debate is certainly worth having.
It is absolutely right that a balance has to be struck. The work is well under way to provide an alternative, and that has to be done in consultation with the landlords associations, which have made a thoughtful and responsible contribution. However, we should be concerned about the homelessness experience; the scale of the use of section 21; the insecurity that tenants are experiencing, which has a disproportionate impact on families with children and on vulnerable tenants, as was well explored by the Rugg review; and the dangerous wider perception in the public’s mind that the private rented sector is not somewhere they can expect to enjoy long- term security, but somewhere they are utterly disempowered in cases where that is a reality.
The picture varies in different parts of the country. It is particularly acute in places such as London, where rents have been highest, so I am also extremely pleased that the Mayor of London has undertaken some work on section 21, security and affordability, and that he will make a research-based contribution to the debate.
I urge the Government not to throw this baby out with the bath water. The Government are rightly interested in greater security of tenure, but the framework of section 21 has existed for 30 years and the landscape has been utterly transformed in that time, so we need a fundamental review of the way the system works to make sure that it acts in the interests of tenants as well as landlords. The time is ripe for a more radical approach to resolving the issue and to making sure that tenants get a fair deal.
My hon. Friend is right. We tend, rightly, to focus on bad landlords. I think we all agree that they are a minority, but there is some shocking practice out there. That is nothing new—some of us can still remember the age of Hoogstraten and Rachman. However, I do not think that that is what the debate is primarily about. As I said in my intervention, it is about changing the climate in the private rented sector for good and bad landlords. It is about changing the way in which the private rented sector operates, which is long overdue.
I am often asked to act both for landlords and for tenants in relation to assured shorthold tenancies. A whole industry grew up, partly fuelled by the excellent housing columns in the magazine Legal Action by their honours Nic Madge, who recently retired, and Jan Luba, who is still a sitting judge. Systematically, over many years, they indicated all the areas of housing law where practice was changing and precedents were being set in the higher and lower courts.
A whole industry developed around section 21 notices, which are actually quite difficult to get right. Landlords who think that they can do it themselves often get them wrong. Although they cannot be challenged on the basis that it is a no-fault eviction—the tenant has been a model tenant, and all the other things that we have heard—they can be challenged if they have got it wrong procedurally. Often they have, but it does not get found out.
That should be spotted, frankly, by the judge, even if they are looking at the case on paper—the accelerated procedure for section 21 notices means that often such matters are not heard in court at all. Without the benefit of legal aid and legal advice, it is difficult to expect the tenant to know the process, but often the landlord does not either and it is, in fact, defective. However, it is an indictment of the way in which the housing market runs if we are reliant on catching landlords out on such procedural matters to give people security.
Is it not also the case that, because tenants do not necessarily know their rights or have access to advice, many people leave their properties, and a much larger number of people feel that they have to, upon the issuing of a section 21 notice, before it goes to court, or at the point of receiving a warrant? They then find themselves judged by the local authority to be intentionally homeless because they did not stay until they were required to leave.
I know that my hon. Friend is, like me, a great rooter around inside plastic carrier bags when they are brought into her surgery. Often one can find, among many other papers, half a dozen possession notices. Social landlords are better at this—or worse, depending on how one looks at the matter—because they often rather lazily issue notices seeking possession with no intention of pursuing them, the only purpose perhaps being to terrify the tenant. However, private landlords do it as well. They will issue section 21 notices like confetti, either as protective notices, or to try to scare the tenant off or something of that kind.
Although my hon. Friend is right that the advice should always be to stay put, to try to get what legal advice is available and to talk to the local authority housing adviser, one thing that the landlord will say is, “If you don’t go now, there will be costs when, at the end of the two-month period, I issue proceedings, or after that when I issue the bailiff notice, and you’ll have to pay them. It will be several hundred pounds at least, and if you challenge, or attempt to challenge, the action it could be more than that.”
The hon. Lady says from a sedentary position that I cannot. The absolute truth is that the person must go to the local authority as soon as they get the section 21 notice, and the local authority then has a duty to help them.
They will not go? Okay, we will find out.
The hon. Member for Bath (Wera Hobhouse) mentioned affordability. That issue is exactly the reason the Government introduced the £1 billion Build to Rent fund, and the £3.5 billion private rented sector guarantee scheme, to help support the building of thousands of extra homes specifically for private rent. We want Build to Rent to continue to grow and make a significant contribution to housing supply.
I will not detain hon. Members long. I am very grateful to the hon. Members who came along this afternoon. A number of others indicated that they wanted to come, but are unfortunately queuing in the Brexit debate. There is genuine strength of feeling in Parliament about the need for change. We heard powerful contributions from my hon. Friends the Members for Easington (Grahame Morris), for Hammersmith (Andy Slaughter), for West Ham (Lyn Brown) and for Blaydon (Liz Twist) and the hon. Member for Bath (Wera Hobhouse). I was particularly touched by the contribution of the hon. Member for Cheltenham (Alex Chalk), because in all my years in Parliament, the number of times that anybody has said that they have changed their mind during a debate can be counted on the fingers of one hand, so that is something I will cherish.
I am grateful to the Minister for her usual courtesy, but I was disappointed by her response. I appreciate that Governments always say no until they say yes, but I hope that, beneath the surface, there is more thinking going on about this issue. Although she is absolutely right that the issuing of no-fault evictions is subject to a number of conditions, I do not think it is reasonable to say that they in any way undermine the application of section 21 to the private rental sector. It is a structural source of insecurity in a growing sector, which is increasingly home to families and others who are looking for security.
The Minister quoted the English housing survey, which said that just 10% of tenants said that their landlords had required them to move, but the sector is now home to 4.7 million people, and there is a danger that we look at a low percentage and confuse it with a low number of people who are affected. Actually, a huge number of people are living under the shadow of insecurity. Homelessness is expensive, traumatic and a huge challenge for local authorities, but it is only the tip of the insecurity iceberg. That has been very well documented by the National Audit Office and many others, and there is a solid body of evidence supporting the need to tackle no-fault evictions in order to help us tackle homelessness, particularly in areas of high housing pressure such as London—but that is not the only reason to do so. There is a much wider problem of insecurity. We have heard the case studies. We know from what Generation Rent and other housing charities are telling us, and from other supporting evidence about the impact of high population churn and mobility, which is overwhelmingly concentrated in the private rented sector, that this is a real and growing problem.
The Minister mentioned the cases that come to court. We know that the cases involving section 21 notices that come to court are only a small proportion of the total. People are living under that shadow and they do not like it, particularly when they are trying to achieve stability in their employment, community and family.
I hope that the discouraging tone that we have heard this afternoon about section 21 is not the end of the story. We are 30 years on from the introduction of a legislative framework that is simply no longer fit for purpose. There is no reason to fear, and no reason for landlords to fear, a change in the law, provided it is set in the proper context of meeting their reasonable needs to secure their property in the case of bad tenant behaviour or return to their home if they wish. Those things are entirely possible within the legislative framework. We will have to see how it works in Scotland. Other countries in continental Europe, such as Germany, have this model and do not have a problem. We do not have to live in a deregulatory housing environment.
This issue is not going to go away. I was encouraged to hear my hon. Friend the Member for Great Grimsby (Melanie Onn) reaffirm that the Labour party would take action to end section 21, but I think that should be consensual if possible. We should be able to build a consensus for change. I hope the Minister will go back to the Department and seek to bring about a change. It is time for a fair deal for Britain’s private renters. That is not the only thing we need to do. We need to tackle the issue of welfare reforms and build social housing, but this is a critical tool in the arsenal of attempting to build a fairer and more decent society for the private rented sector. This is an issue to which I know we will return.
Question put and agreed to.
Resolved,
That this House has considered the use of Section 21 evictions in the private rented sector.