Landlords

Section 21 no-fault possession claims see healthy decline in 2017

Warren Lewis -
|
15th March 2018
paul shamplina 333

According to the latest Ministry of Justice figures, the number of accelerated possession cases are on a downward trend, with nearly 5000 fewer cases in 2017 than in 2016.

Paul Shamplina, founder of Landlord Action, believes this could be attributed mostly to changes introduced as part of the Deregulation Act 2015, but says it is likely to increase again as the impact of changes to tax liabilities take hold. 

Annual volumes of possession actions in 2017 have all decreased from 2016; claims are down 3%, orders down 6%, warrants down 5% and repossessions down 12%. Interestingly, the volume of claims brought by social and private landlords under the standard procedure have remained stable, showing only marginal decline from 2016, down 1.4% and 5.4% respectively. Whereas accelerated possession cases, which had previously followed a moderate upward trend since 2010 before peaking in 2015 (at 37,663), saw a 13.7% drop in 2017 to 29,611 from 34,303 in 2016.

The accelerated possession procedure, or Section 21 no-fault eviction as it is often referred to, enables orders to be made by the court solely on the basis of written evidence and without calling the parties to a hearing.  Despite the majority of cases handled by Landlord Action being as a result of rent arrears (73%), many landlords choose to use accelerated possession procedure (61%), even though they forfeit the opportunity to recover outstanding rental money, because it can be a faster way of recovering the property so that it can be re-let. 

However, Paul believes that new legislation has made the accelerated procedure increasingly challenging to use and not always quicker as it relies on several conditions being met.  He points out that a lot of landlords are still unaware of their obligations under the Deregulation Act, which came into force in October 2015, and this is delaying or hindering landlords’ chances to use the accelerated procedure.  

He said: “In a number of recent cases, we’ve found that landlords have not provided tenants with an Energy Performance Certificate and a Gas Safety Certificate before the tenancy began, or they did not protect their tenant’s deposit, all of which are legal requirements in order to serve a section 21 notice. By the time landlords come to us, the relationship with the tenant has usually broken down making it harder to gain access to the property and deal with these issues, meaning the landlord can’t use a section 21.”

According to the MoJ, in October to December 2017, accelerated landlord possession cases took 7.3 weeks to progress from claim to order, compared with private landlord cases which took 8.2 weeks. However, from claim to possession warrant, accelerated and private landlord cases took 15.9 and 14.4 weeks respectively and from claim to repossession by county court bailiff, accelerated cases took on average 23.1 weeks while private landlords took 21.8 weeks. 

“The term ‘accelerated’ is not really an appropriate name for this procedure, as the statistics show, it is not actually quicker any more.  Despite this, I predict we will see another rise in use of the accelerated possession procedure over the next couple of years as more landlords are forced to sell of properties off the back of rising interest rates and increased tax liabilities” adds Shamplina.  

 

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