New Procedures To Follow Before Issuing A Section 21 Notice
Section 21 notice is a document served to tenants telling them that they should leave the property once their lease agreement expires. It’s not an eviction notice, but just a soft reminder to the tenant that he or she will have to move to a new place at the end of his contract.
Without compliance with Section 21 notice, landlords won’t be able to get their properties back from their tenants.
The common practice is to issue a Section 21 notice at the start of the tenancy. However, under the new rules, landlords are prevented to issue this notice within the first 4 months of a fixed-term tenancy agreement.
How does this affect you? Simply put, in the new timeline, you won’t be able to serve a section 21 notice to expire at the very end of a 6-month term. Instead, the section 21 notice will expire a little over the seventh month. So if your tenant leaves at that time, you will be obligated by law to repay the remainder of the rent of the seventh month to your tenant. The only way to avoid this scenario is if you offer lease agreements longer than six months.
Apart from that, new rules also order landlords to present the following three documents to tenants who will begin their tenancy on or after October 1:
- Energy Performance Certificate (EPC);
- Gas Safety Certificate; and
- A copy of the government’s “Hot to Rent” guidebook.
Failure to comply with this additional requirement at the start of the contract will render any Section 21 notice issued under the said terms invalid.
Why do all landlords have to present these extra paperwork to their new tenants anyway?
Energy performance certificates are given out to inform new tenants about average fuel and energy bills in the property, so that they can compute right away if they can afford to pay for these extra costs every month.
The first 6 pages of the government’s guidebook, on the other hand, give prospective tenants some advice on what to look for in a rental property before they sign a rental agreement. These guide books are regularly updated, that’s why it’s important to check for new versions whenever you’re signing new tenancy agreements.
At first glance the changes seem to be harmless, but a few landlords are criticising the rules because the documents are already useless at the time they are given. Remember that the new procedures only require them to be at the beginning of their tenancy – this means that the tenants have already signed a lease agreement with the landlord when they are given these educational materials.
Hence, these critics argue that the information will not be put into good use, because the tenants will already be bound by a tenancy contract when they read the materials.
But wait there’s more!
Alongside these changes, the following provisions which are found in the Deregulation Act of 2014 are also set to take effect on October 1:
- Landlords must now provide a copy of the Deposit Protection Agreement to the tenant within 30 days from payment of money;
- The necessary license, whether it be for HMO or selective and additional licensing, must be accomplished; otherwise the erring landlord would experience; and
- Landlords won’t be able to issue Section 21 notice to tenants which have an existing complaint against to prevent the phenomenon called “retaliatory eviction.”
Laws change constantly, and when they do, there may be unintended consequences to the parties involved. In the end, we’ll all have to adapt with the changes soon; otherwise you could end up paying for unnecessary fines. Be sure to keep yourself updated to help yourself avoid potential hassles.