With rental reform the key topic of discussion in the UK lettings sector, automated rental payment specialists PayProp have made the case for tech bringing greater efficiency to the greatly expanded role of the courts in the eviction process.
While the timetable of rental reform may now be delayed by the race to fill the post of Conservative Party leader and Prime Minister, PayProp suggests that with all sides of the political spectrum seemingly agreeing on the removal of Section 21, time should be dedicated to working with the sector in improving the efficiency of Section 8 evictions.
As part of the White Paper, the government has confirmed that significant rent arrears or a landlord needing to move into the property themselves will be mandatory grounds for eviction.
A new mandatory ground has also been announced – for repeated arrears, applicable when tenants fall into arrears persistently but do not owe at least two months’ rent.
A more efficient court process
Once Section 21 ‘no-fault’ evictions are removed, landlords will only be able to end tenancies when they have one of the specific grounds for possession.
However, landlord groups are concerned that the already backlogged court system will struggle to cope with any additional evictions that come from the removal of Section 21.
It currently takes a private landlord approximately nine months to repossess a property through the courts.
“There is a big opportunity for the government to embrace technology to speed up the evidentiary aspect of mandatory evictions,” said Neil Cobbold, managing director of PayProp UK.
“In cases of rent arrears and the new mandatory grounds of repeated arrears, accurate evidence will be key.
We are encouraging the government to accredit verifiable records of payments and arrears, including data from banks and third-party platforms that use real-time bank records so courts can be confident that the records in front of them are a true reflection of the situation.”
As the courts will now have to deal with all eviction cases, Cobbold says PayProp wants the first-tier tribunal to hear eviction cases brought on mandatory grounds, rather than landlords having to go through the longer, more expensive court process.
“In cut-and-dried arrears cases, where courts have access to indisputable evidence provided by accredited third parties, eviction cases should be sped up, with the process taking days, not months – so long as the government recognises the ability of technology to help.”
Benefits for all
To gain accreditation from the government, data providers must ensure payment demands and transaction records are always accessible to landlords, tenants and agents so all parties know where they stand and how much is owed.
By insisting on this heightened level of communication, the government can help encourage a more transparent industry as all have access to the same data so it will be difficult for any party to challenge its accuracy in court.
By keeping all parties fully informed of any missed payments or outstanding amounts, agents can help proactively manage arrears with the aim of avoiding an eviction.
By acting as a mediator between landlords and tenants, agents can help manage expectations and develop affordable payment plans that allow tenants to remain in the property while landlords are repaid and avoid a costly eviction.
This in turn could reduce the number of evictions that make it to court, allowing necessary evictions to proceed at a faster pace.
Is rental reform still happening?
The Department for Levelling Up, Housing and Communities published its White Paper, ‘A fairer private rented sector’, in June this year.
The White Paper aims to reform the private rented sector and level up housing throughout England – but with Boris Johnson being replaced as Conservative Party leader, his successor may prefer a different approach to rental reform.
“While there is a chance that a new PM could have a different viewpoint on rental reform, there is broad cross-party and public consensus on the need for change, but the Bill’s journey to Parliament is almost certainly delayed.” Cobbold says.
“However, this delay gives the industry more time to assist the government to get the balance right on rental reform to ensure that the legislation takes the concerns of agents, landlords and tenants into account.”
Those in the private rented sector can currently submit evidence to the Levelling Up, Housing and Communities select committee inquiry into reform of the private rented sector (PRS).
“It’s clear that whatever the outcome of the Conservative leadership election, rental reform is still on the horizon.
With the Levelling Up, Housing and Communities select committee gearing up to scrutinise the government’s proposals, now is an ideal time for all in the PRS to help contribute to the debate around rental reform to ensure voices from all sides are heard.”