What a year. Legislative changes in abundance driven through the emergency legislation that is the Coronavirus Act 2020 and changes often released on a Friday afternoon or bank holiday weekend.
The most notable changes affecting Housing and the PRS sit around Notices, both Section 21 and Section 8, Court Claims and Evictions. The most recent announcement was made on the 30th April 2021 with regards to the Section 8 notice and "Breathing Space". Whilst the trade press were quick off the mark in reporting the announcement, the new notice has yet to be issued.
What does this change Mean?
From the 4th May 2021, if a tenant is in a ‘Breathing Space" moratorium, letting agents and landlords will be prevented from chasing for rent arrears, charging late interest, and fees, and taking any enforcement action for rent arrears caught by the moratorium. Any action taken by the landlord or letting agent will be null and void if it is in breach of the regulations.
However, breathing space can ONLY be granted through a debt adviser (regulated by the Financial Conduct Authority) or the tenants’ local authority.
There are two types of breathing space:-
1. A ‘Standard Breathing Space’ which lasts for 60 days; and
2. A ‘Mental Health Crisis Breathing Space’ which lasts for as long as the tenant is receiving treatment for their mental health plus 30 days after the treatment has ended.
Please note, it is not a simple process, there needs to be evidence that the tenant in question has obtained "Breathing Space".
And the Impact on Section 8 Notice?
The current Section 8 notice used for possession claims under the Housing Act 1988 will be replaced with a new version (Check Government Publications Website). The main body of the form will remain the same, BUT there will be new notes at the top (for landlords) and at the bottom (for tenants) which focus on the new "Breathing Space" regulations.
The notes will state that a Section 8 notice cannot be served if the rent arrears (debt) are subject to a "Breathing Space".
Existing notices served before 4 May 2021 will stand as they are.
If the incorrect notice is used, it may be accepted by the courts, yet given that the "Breathing Space" affects the validity of the Section 8 notice, the risk of the notice being refused by a judge could be quite high.
