Landlords all over the country cannot have failed to note the passage through parliament of the Renters’ Reform Act. This has led some to ask whether now is a good time to sell up, or whether the balance of rights between landlord and tenant has been tilted too far in favour of the latter.

A central feature of the legislation has been the abolition of Section 21 evictions, commonly known as ‘no-fault’ evictions. Under the old law, detailed in the Housing Act of 1988, landlords could give the tenant notice to quit without having to give any reason. Now that the new legislation is in place, Section 21 has been abolished.

This still means that tenants can be evicted for unreasonable or unlawful behaviour, such as damaging the property or not paying the rent (this is provided for in section 8 of the 1988 act), but what happens if you want to sell your house, while not having any behaviour-based reason to evict the tenants?

How Can Landlords Still Sell Houses?

The good news for you as a landlord is that you can indeed still sell the property as an ongoing provision of section 8, whether or not this involves evicting the tenant, although four months’ month’s notice is required if they do have to leave. The exception to this is if the tenant has a fixed tenancy.

If you are selling at the end of a tenancy by arranging the sale at the end of the fixed term (at which point the property will be vacated), the situation will be straightforward.

However, if you sell the property in the middle of a fixed term, the tenant still has the right to see out their term. It will be up to the buyer of the property whether or not they continue to rent it out thereafter, or change its use, for instance to live in it as their own home.

What Is The Abolition Of Section 21 Intended To Achieve?

To understand what the Section 21 ban is designed to do, it is worth reflecting on how this came about.

Firstly, Section 21 evictions were banned during the COVID-19 pandemic, recognising the practical difficulties in finding a new home and making the move during lockdowns.

This was not made permanent, but the Conservative government did propose to abolish Section 21 in the Renters’ Reform Bill, which was part-way through parliament, but lapsed, when parliament was dissolved in May last year ahead of the general election.

After winning the election, the new Labour government introduced the Renters’ Rights Bill, which contained many elements of the previous bill.

The rationale behind the Section 21 ban was that it removed the fear tenants had of sudden eviction, protected them against ‘rogue’ landlords and meant they could challenge issues like poor maintenance without the threat of eviction in response.

Notably, landlord bodies like the National Residential Landlords Association stated it had no objection to getting rid of Section 21, although it did call for it to be replaced with a system that is “swift, effective and fit for purpose”.

Whether the new rules in place offer that is open to debate, but what is not in question is that, yes, landlords can still sell a property that they have rented out.