Section 21 homelessness threat down 50% YoY

Government celebrates halving the threat of homelessness to tenants, following a Section 21 eviction. But, have landlords in England borne the cost of unpaid rent?;
Section 21 homelessness threat down

The Ministry of Housing, Communities and Local Government (MHCLG) has confirmed a fall of nearly 50%, in households facing the possibility of homelessness, as a result of a Section 21 eviction.

A Section 21 notice is the notice a landlord must give, to begin the process of regaining the possession of a property, which is let out on an assured shorthold tenancy.

The notice, however, doesn’t provide any legal powers to end the tenancy. This can only be achieved through either a court order, which can be sought after the notice has expired, or by the tenant voluntarily ending their tenancy.

Between October and December 2020 the MHCLG found 1,920 households were receiving assistance, after having been served a Section 21 notice. This represents a 49.9% fall when compared to the same period during 2019.

The MHCLG has explained the fall is as a result of long standing eviction bans, a ban on bailiff enforcement activity and the extension of the length of the notice period for evictions.

In a statement they confirmed that the fall “will largely reflect the ongoing measures to protect renters during the Covid-19 pandemic”.
The 1,920 households receiving assistance made up 6.8% of all households that require help to prevent them from falling into homelessness.

Crisis charity seeks further tenant support

Jon Sparkes, the Chief Executive of the homelessness charity Crisis emphasised the need to continue to support those facing possible homelessness from the effects of the COVID-19 pandemic.

He said:

“As the economic impact of the pandemic continues to be felt, we risk seeing thousands more people in situations like this, being pushed into homelessness and needing support to keep a roof over their heads”.

308 of 314 local authorities provided homelessness data for the last quarter.

Overall 62,250 households were deemed as either homeless or at risk of becoming homeless. This represents a 9.2% fall when compared to the same period in 2019.

The local authorities have a 56-day obligation to take reasonable steps to either prevent or relieve a household’s homelessness, by helping them try to secure accommodation for at least six months.

The authorities’ data identified single males as the most at risk group. They made up 53% of all homeless households and 32.5% of those who needed help to avoid homelessness.

32% of households were identified as becoming homeless due to being unable to move in with friends or family due to the Covid-19 lockdown restrictions.

A further 12% cited domestic violence as the reason for their homelessness.

The pandemic and resulting lockdowns have brought a rise in domestic violence with the charity Refuge seeing an average increase of more than 60% in the number of calls they have received since March 2020.

When trying to identify ways to reduce homelessness in the UK further, Polly Neate, chief executive of the charity Shelter said:

“If the Government wants this country to recover quickly from the pandemic, investing in a new generation of secure social homes is an absolute must.”

Does the drop in homelessness risk come at a cost?

A huge drop in the threat of homelessness is cause for celebration.

However, many landlords will likely be questioning whether they are the ones carrying the cost.

The eviction ban has had a major impact on the private rental sector.

Many landlords had debt mounting from tenants that pre-dated the pandemic, but they were forced to continue carrying and accruing the financial burden, until an exemption was introduced earlier this year.

The full repercussions are as yet unknown and it is likely this won’t be clear for some time to come.

This information should not be interpreted as financial advice. Mortgage and loan rates are subject to change.