Tuesday, 9 September 2008

The Citizens Advice Bureau challenge to Section 21 Notices

Last week in this Blog we highlighted the campaign led by the Citizens Advice Bureau (CAB) to significantly alter Section 21 Notices (please see the article below). Under a Section 21 Notice a landlord has the automatic right to repossess their own property. Providing the relevant forms are submitted to the courts correctly the court has to award possession of the property back to the landlord.

It is a vital piece of legislation. It protects the investment that the landlord has made by ensuring that they can always re-claim the property. It has also been the catalyst for the Buy-to-Let boom since the late 1980s, in particular because it enables lenders to offer mortgages safe in the knowledge that they can gain vacant possession should the landlord default on the payments.

As we explained in our last email this situation is now under threat. In a publication called A Tenant’s Dilemma – Warning: Your home is at risk if you dare complain the CAB spell out why they want a change in the legislation.

No-one wants to see tenants evicted by irresponsible landlords, especially vulnerable tenants. NetRent.co.uk would willingly support any scheme that could be proven to stop such evictions. The CAB report would have you believe that evictions by evil landlords are widespread. But just how big is the problem that has caused the CAB to launch this campaign? According to their own report:

“Eviction from an assured
shorthold tenancy is one of the most common
reasons for households becoming statutorily
homeless. In 2006, 10,470 households were
accepted as statutorily homeless by local
authorities following eviction from an assured
shorthold tenancy, accounting for around
13% of all homelessness acceptances (DCLG
homelessness statistics, 2006).”

Whilst not wishing to diminish the impact for any of the people affected, there are around 2.5million privately rented homes in the UK. Therefore, if the CAB statistics are correct this problem affects just 0.41% of tenancies in the UK.

The implication from the CAB report is that every one of the 10,470 made homeless following eviction is the victim of unscrupulous landlords. They make no distinction between ‘landlords from hell’ and ‘tenants from hell’. It is totally unfair to assume that every eviction is due to vindictive landlords.

We have been flooded with emails and phone calls into our office since we launched our Petition Against Changes to Section 21. Landlord after landlord has told us about their experiences with ‘tenants from hell’. The CAB report makes no reference to this and the reader is left with the impression that a huge social problem lies squarely with landlords victimising helpless tenants.

The CAB’s focus is on retaliatory eviction. So how widespread is retaliatory eviction? According to the CAB report 129 Environmental Health Offices responded to their questionnaire. Asked whether tenants were deterred from asking for help in case of retaliatory action the CAB state:

“Forty eight per cent of respondents said this happened
always or often.”

Actually, according to the CAB’s own report, just 2% said this always happens, 46% said it often happens and the majority, 54%, said that it sometimes happens. There are no statistics to back up these claims just the ‘gut feelings’ of 129 Environmental Health Officers (EHOs), 67 of whom said that they believe the problem ‘sometimes happens’. Less than 3 of the EHOs they questioned believed that landlords always issue retaliatory Section 21 notices against tenants. Based on this evidence the CAB feel confident enough to call their report Warning: Your home is at risk if you dare complain.

Nowhere in the CAB report did they question landlords about why landlords seek repossession under Section 21. They claim that they spoke to landlords but they conducted no survey they were prepared to publish. I suspect that the CAB knows why landlords usually issue Section 21 Notices, but it doesn’t serve their purpose to highlight the reality that far more landlords have problems with tenants than tenants have problems with landlords.

What the CAB report singularly fails to do is offer any sort of balanced view of the use of Section 21 Notices. The report is peppered with provocative images of tenants living in squalor. The title itself is inflammatory Warning: Your home is at risk if you dare complain hardly gets the report off to a balanced start. Imagine the outcry there would quite rightly be if landlords published a report called Warning: Your home is at risk if you let it to DSS tenants.

We all know that some landlords don’t care about their properties or their tenants. We also know that some tenants have no respect for the landlord’s property, but that isn’t even mentioned in the CAB report. To tarnish all landlords with an imaginary brush in order to deal with this problem should weaken the CABs claims. However, if landlords do nothing they will get away with this unwarranted attack.

As we said in the previous post on this Blog, the implications of a change in Section 21 Notices are huge. We are currently discussing these implications with landlords, tenants, lenders and others in order to present a full picture. We will report our findings shortly on this Blog.

Meanwhile, we ask landlords to join us and help prevent any changes to Section 21 Notices before a full, frank and open debate has taken place. To do this please sign our Petition Against Changes to Section 21. Please also tell other landlords about this petition.

So far just 2 landlords have contacted us to tell us that they do not support the aims of our petition, whilst nearly 1,300 have already signed. We believe that unless landlords act now and in great numbers the CAB and others are likely to push through changes to Section 21 Notices that would adversely affect landlords, tenants and potentially the whole UK housing market.

Please sign the Petition Against Changes to Section 21 Notices