Possession during Covid-19: A landlord perspective
The NRLA has campaigned extensively for reform in the possession process due to lengthy delays. As landlords currently absorb the costs associated with the lengthy court waiting periods, the ban on the repossession of property introduced in response to the COVID-19 outbreak has exacerbated the problem.
As part of our quarter 3 survey, we asked landlords about their experiences with possession over the course of the last 2 years to shed some more light on this issue. We found 17.3% of landlords had issued some form of notice since April 2019.
If a landlord wishes to regain possession of property, they are currently able to issue two different types of notice, Section 21 or Section 8.
Section 21 has typically been the most common route for landlords seeking to repossess property as it does not usually require you to attend a court hearing or provide a reason for seeking possession. Changes to Section 21 notice periods in line with COVID-19 regulations may have altered route preference for landlords, as will the recent restrictions on bailiff possessions.
We asked landlords who have issued notice since April 2019 if said notice was Section 21 or Section 8.
When landlords issue notice, which do they use?
Reasons for issuing notice
Landlords were asked what their reasons were for issuing notice
Though landlords cited rent arrears as the most common reasons for issuing notice to tenants, it is notable that landlords cited a wider selection of reasons for issuing Section 21 notices.
COVID-19 Impact: Reasons for notice
By splitting our survey sample into two time blocs, before and after the eviction ban, instated due to the growing concerns over renters during the pandemic, we have been able to assess how landlords have been impacted.
After the eviction ban, the proportion of landlords issuing Section 8 notice due to rent arrears (both mandatory and discretionary) had decreased. This could suggest landlords were giving more leeway to tenants in respect to rent arrears.
The proportion of landlords citing anti-social behaviour for issuing notice after the the eviction ban also increased, for both Section 8 and 21 notices. This increase in ASB highlights the necessity of repossession in these instances, with landlords continuing to seek possession whilst other factors decrease.
Stage of possession claim
The process of seeking possession involves multiple stages, from issuing notice to regaining possession of the property. We asked landlords at what stage their unresolved possession case was during the fieldwork period.
Landlords most commonly stated that they had issued notice, but not yet officially filed for possession, this is the first stage in regaining possession of property.
Over three quarters of landlords who have issued a Section 21 notice have not yet passed this stage, 79.0%, compared to 59.3% of Section 8 cases. This suggests that landlords who have issued Section 21 notices are less likely to pursue their case.
COVID-19 Impact: Stage of possession
By splitting our sample into two time blocs, we can also assess the impact of the eviction ban on the stage of unresolved possession claims.
After the introduction of the eviction ban, it is clear fewer landlords have been able to make any progress on their unresolved cases. Despite cases started earlier being more likely to be further along the process, a difference of over 20 percentage points for both Section 21 & Section 8 is substantial.
The impact of the initial ban on possession cases and subsequent regulations imposed upon the process has been substantial and will continue to impact the private rented sector going into 2021. Despite this, the proportion of landlords issuing notice due to rent arrears is decreasing, suggesting landlords are giving tenants more leeway given the circumstances.
The possession ban means there is an increasing backlog of unresolved cases for the courts to deal with, the NRLA is campaigning for a "spanish-style" tenancy sustainment loan system whereby tenants could apply to the Government for a loan to pay back rent arrears. This would alleviate much of the financial concerns that influence landlords issuing notice.