Section 21 Ban Delay: Implications for Landlords and Tenants

Section 21 Ban Delay: Implications for Landlords and Tenants

There have been mixed reactions to the announcement that the government is to postpone its proposed ban on Section 21 evictions.

Landlords breathed a sigh of relief. While the decision is to postpone the move, rather than drop it, the delay does give landlords more time to adapt to the impending changes.  But, after their initial reaction, many landlords began to question what might be implemented in place of Section 21 and when. The uncertainty they’re facing has no current end date.  They are also expressing concerns that the Section 21 ban delay might usher in a surge of rent arrears.

This delay will undoubtedly alter their behaviour. Those planning to leave the sector will find little comfort in a delay. They’re already becoming more and more discerning in selecting their tenants and may increasingly resort to Section 8 grounds for possession based on tenant behaviour.

On the other hand, tenants are critical of the delay. The reform they were promised is on hold for now. They see the move as one which leaves them vulnerable to eviction without valid reasons and fear it could lead to a rise in homelessness.

Their behaviour is also expected to change due to the Section 21 delay. Rent punctuality and property care are likely to be taken more seriously, with tenants being more inclined to challenge any eviction attempts.

The government, meanwhile, maintains its commitment to abolish Section 21 evictions. But with huge delays already affecting the courts, they are mindful that the reform will significantly increase the caseload.  The plan is to invest £27 million to enhance court capacity and efficiency.

With the promised reform delayed, the government’s choice to postpone the Section 21 ban has stirred controversy. It may well become a pivotal topic in the upcoming election.

Property taxes: Possible Contenders for Reform?

Delaying the Section 21 eviction ban has prompted speculation about other aspects affecting the housing market.  When Chancellor, Rishi Sunak promised to establish the UK as the “most competitive tax system in the G20”, a comment which has led to discussions about potential changes to property taxes.

Stamp duty, for example, frequently emerges as a potential candidate for reform. As the tax is imposed on property purchases, it can discourage individuals from moving home or impact landlord investment decisions. While the government has affirmed its intent to review stamp duty, no concrete plans for altering the tax have yet been announced. Other levies such as council tax or capital gains tax could also be reformed.

Striking a Balance

The government’s decision to delay the Section 21 eviction ban reflects the need to strike a balance between the interests of landlords and tenants. But any changes to property taxes will affect the property rental market and the implications for both landlords and tenants will need careful consideration.

Landlords need to stay informed and understand how best to navigate both the uncertain period ahead and the years to come.

1 reply
    NAVINCHANDRA Raichand HARIA says:

    Reducing taxes and banning IHT would release more properties in the market.
    More properties with with lower values and SDLT would be affordable to buyers, possibly reducing rental demand and rents
    The chancellor could still have the same or higher tax revenue in the accelerated market

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