New Lifetime Deposit Scheme & End Of Section 21
The government’s Queen’s Speech has confirmed what the industry has effectively been expecting for some months. There will be a new lifetime deposit scheme which according to a government statement “will see tenants’ hard-earned deposit move with them from property to property – giving tenants more control over their lives and keeping more of their cash in their pocket.”
Proposals to abolish Section 21 no-fault evictions have also been confirmed: the government says this means “landlords will no longer be able to uproot tenants from their homes at short notice and with no good reason – bringing greater security to millions of families who live in rented accommodation.”
But Whitehall also insists that there will be “new powers to strengthen the rights of landlords to gain possession of their property through the courts when they have a clearly valid reason to do so, in order to create a fair market where good and responsible landlords flourish.”
These were all broad commitments made in the Conservative manifesto at the General Election.
Campaigning charity Shelter, which has long argued for the abolition of Section 21, was quick to back the Queen’s Speech. “Very proud Shelter has campaigned for this and kudos to [pressure group] Generation Rent for consistent leadership to get this over the line” tweeted Shelter’s chief executive, Polly Neate.
A statement from Georgie Laming, campaigns manager at Generation Rent said: “The new Renters’ Reform Bill is brilliant news for renters. It’s proof that the government is finally recognising that the unique challenges of Generation Rent need to be addressed head on. Ending unfair evictions will reduce homelessness and provide renters with a house they can call a home for as long as they want. The new lifetime deposit scheme will also save renters taking out expensive pay day loans to make end meets during a house move.”
And Dan Craw Wilson, Generation Rent’s chief executive, himself tweeted: “There it is in black and white … now official government policy. Big job in 2020 is to get the detail of the new law right so renters are treated fairly.” Craw Wilson then appealed for “a few quid” to fund the campaign his group has been waging against landlords and agents.
Meanwhile the government plans to scrap ‘no fault’ evictions have been described as “ruinous” by the National Landlords Association. Its chief executive Richard Lambert says: “Landlords need certainty of their ability to end failing tenancies. If this cannot be provided by Section 21 then the government must reform the courts. Strengthening landlords’ rights will make no difference if the court process is seen as simply delaying or obstructing possession.
“The NLA is deeply concerned that the government will precipitate a housing emergency, deepening the crisis of supply and affordability faced by many households. Landlords will stop letting to tenants who are perceived as higher risk and ultimately sell properties which would otherwise provide much needed homes for those who cannot afford to buy.
“If ministers do not address the problems of capacity within the Courts Service before removing landlords’ ability to use the no-fault procedure, the dramatic increase in cases that will be brought before it will bring the system to its knees.”