S21 eviction ban delayed before the Renters’ Reform Bill’s second reading

We have been charting the progress of the Renters’ Reform Bill since it was announced in 2019 during Theresa May’s tenure as Prime Minister. In late October 2023, a little more progress was made and the Bill had its second reading in the House of Commons.

The timing was crucial for two reasons. Firstly, the current session of Parliament is coming to an end. If the Conservative party wants to press ahead, it requires a carry-over motion as the Bill did not pass by the end of the session of Parliament it was introduced in.

Secondly, a General Election has to happen by the end January 2025 and we’re firmly in campaigning territory. All parties are using the coming months to win votes and the Conservatives are ramping up their announcements to appeal to the masses.

The Bill’s second reading gave the Conservatives the chance to win over landlords. It hoped to do so by amending the Bill before its second reading and shelving the ban on Section 21 notices for those in England and Wales. The proposed move to end so-called ‘no fault evictions’ was poorly received by property investors and buy-to-let owners, and was touted as a major reason why many landlords were looking to leave the lettings market.

Housing Secretary Michael Gove said the ban on Section 21 notices would be indefinitely delayed until after the current court system is reformed. In his announcement, there was no deadline for any court reforms to start or conclude and, therefore, no date by which the ban on Section 21 notices may be reintroduced. The retraction of the ban gives landlords peace of mind that they can still regain possession of their property without having to cite a set reason from a restrictive list.

The rest of the Bill’s second reading passed without drama. Although the Bill was debated by those in the House of Commons, no votes were cast, as is normal for this stage in the process. With the second reading complete, the Bill now works through the committee stage, the report stage and a third reading – to be undertaken in both houses - before Royal Assent can be given.

The delay in banning Section 21 notices comes off the back of another landlord vote-winning announcement from the Government. During the Conservative Party Conference earlier in the autumn, it was announced that proposed changes to EPCs in the private rental sector – changes that would force landlords to improve the energy efficiency of their buy-to-lets – was to be scrapped.

The next major opportunity for the current Government to make vote-winning announcements will be the Autumn Statement on 22nd November 2023. Currently, there is some speculation that the Chancellor will curry favour among voters by scrapping the planned cut to the capital gains tax allowance. There could also be news on corporation tax, which applies to landlords who operate as a limited company. Finally, there are murmurs that the Chancellor could introduce another stamp duty holiday, which would prove beneficial for investors wishing to grow their property portfolio.

If you are a landlord looking to make more sense of the recent glut of Government announcements, please contact us. We can explain how recent news may prove beneficial for your buy-to-let activity.