The Deregulation Act 2015 makes a number of significant changes to the mechanism for serving notices to quit (NTQ) for Assured Shorthold Tenancies (AST) under Section 21 (used for residential property). These changes are of course pertinent for both landlords and tenants, although the implications generally increase protection for tenants. While this may not pose a problem for some landlords with well-maintained housing, they should nonetheless take note should they need to serve a NTQ in the future.
The changes have a number of implications, the first of note, which applies from the 1st October 2015 is that landlords cannot serve a Section 21 notice to quit if the tenant has made a written complaint about the condition of the premises and either the landlord did not respond within 14 days, or did not provide an ‘adequate’ response. Where a local authority has served a housing disrepair notice, this will also preclude a landlord from serving a NTQ for a period of six months, which could have significant implications.
As of the 1st July 2015 these new regulations also state that a Section 21 is ineffective if the landlord is in breach of their Health & Safety requirements, for example gas safety certificates, or has not complied with the energy performance requirements for let property. Landlords should therefore take note of this should they be considering a notice to quit in the future, and ensure all regulations are complied with.
There are however various circumstances where a tenant will not be assisted by these new provisions. These include where the poor condition of the property giving rise to their complaint is a result of the tenant’s breach of their own duty to use the property in a “tenant-like” manner, or where a receiver is entitled to effect a sale under a landlord’s mortgage.
Another point of note is that the Act prevents landlords from serving a Section 21 notice at the beginning of an AST to bring the tenancy to an end at the end of the initial six month period. Instead they must wait for the expiry of the first four months of the term before serving the Section 21 notice. This in practice means that for those landlords wishing to end a tenancy at the end of the initial six month term, they will have only one day to serve their two months’ notice under Section 21. By delaying, the notice will only be effective following the expiry of two months from its service, which may only be several days after the expiry of the fixed term. The important point to note here is that notice cannot be served at the very start of the tenancy, which is common practice currently.
One benefit however for landlords is that a Section 21(4) notice (to end statutory periodic tenancies, which apply after the initial fixed term of an AST comes to an end) no longer need to bring the tenancy to an end at the expiry of a period of the tenancy, and instead can simply end in two months’ following service of the notice.
Also of note is the provision that enables the Secretary of State to set out a prescribed form for Section 21 notices in the future. Previously Section 21’s needed to contain certain information, but were not required to be in a set format. The fact that this has been provided for implies that we can expect a prescribed form in the future, and landlords should check this has not been confirmed before serving any Section 21 notice.
As always the devil is in the detail and accordingly those who are not certain should consult a professional before proceeding with an uncertain course of action to ensure they achieve the outcome they require.