Eviction services for landlords with tenants in rent arrears and problem tenants in London and England.
What are the Eviction Options available to Landlords in England
A client once asked what the first stage in divorce proceedings is and that being my umpteenth case, I honestly responded, “The wedding”. This analogy holds equally true for eviction proceedings. When entering into the tenancy matrimony as it were, it is crucial to be mindful of the much despised but real possibility of an eviction in the long term. Failure to do so could prove costly if and when the dreaded day of reckoning comes because, by that time, your options could be compromised. The purpose of this article is to walk you through the essentials of the eviction process with specific regards to Assured Shorthold Tenancy.
THE FIRST STAGE - PRE-EVICTION COMPLIANCE
The time of inception of the AST is crucial for every landlord in London. There are certain onerous pre-requisites which if ignored at the beginning would deprive the landlord of the option of a section 21 eviction.
The law deprives a landlord in London the option of a section 21 notice:
(a) During the first four months of the tenancy (but where the tenancy is a replacement tenancy, the four-month-period is calculated by reference to the start of the original tenancy and not the start of the replacement tenancy see section 21(4B) of the Housing Act 1988);
(b) Where the landlord in London is prevented from retaliatory eviction under section 33 of the Deregulation Act 2015;
(c) Where the landlord in London has not provided the tenant with both current copies of an energy performance certificate and gas safety certificate;
(d) Where the landlord in London has not provided the tenant with the Ministry of Housing, Communities and Local Government’s publication “How to rent: the checklist for renting in England”;
(e) Where the landlord in London has not complied with the tenancy deposit protection legislation namely ensuring the tenant’s deposit:
i. Is not more than 5 weeks' rent;
ii. Is protected in a scheme
iii. Was protected not more than thirty days after inception of the most recent contract.
(f) Where a property in London requires a licence but is unlicensed in relation to Houses in Multiple Occupation (“HMO”) or
(g) Where the landlord in London is prevented under section 17 of the Tenant Fees Act 2019. (NB No section 21 notice may be given in relation to a tenancy where a landlord has breached section 1(1) or Schedule 2 of that Act so long as all or part of the prohibited payment or holding deposit has not been repaid to the relevant person or applied to the rent or deposit with the consent of the relevant person.)
Resultantly, to retain the prerogative of evicting a tenant for no fault of their own, it is key to comply with the above pre-requisites at time of entering of the contract or such other time as may be prescribed.
THE LATTER STAGE - EVICTION NOTICE SERVICE
The other crucial time in respect of evicting a tenant is the time at which the landlord would want to evict the tenant. The decision as to which notice to adopt is dependent primarily on whether there are grounds for the intended eviction, and if so, what the grounds are?
As aforementioned a section 21 notice is appropriate where the landlord in London does not have particular grounds for eviction. Suffice it to say, the landlord in London, in that case, should check for their compliance with the aforementioned checklist.
Prior to the outbreak of the pandemic, a landlord in London had to give a tenant 2 months’ notice to evacuate before instigating legal action to achieve the same. However, due to the current COVID-19 virus, the timeframe for a section 21 notice has been fluctuating throughout different periods of the year. This is encapsulated as follows:
Time of Year with Minimum Notice Period in 2020
Where a section 8 notice is concerned the landlord in London will be required to allege certain grounds for evicting the tenant. By far the most common ground for eviction is rental arrears or delay in payment of rent. However, the particular formalities to observe in issuing the notice must be informed by the grounds alleged.
Amongst the formalities to be considered are the time frames to be observed. The scope of neglect that will suffice to obtain an eviction order for failure or delay in settling rentals is established in Schedule 2 to the Housing Act as follows:
Both at the date of the service of the notice under section 8 of this Act relating to the proceedings for possession and at the date of the hearing -
(a) If rent is payable weekly or fortnightly, at least eight weeks’ rent is unpaid;
(b) If rent is payable monthly, at least two months’ rent is unpaid;
(c) If rent is payable quarterly, at least one quarter’s rent is more than three months in arrears; and
(d) If rent is payable yearly, at least three months’ rent is more than three months in arrears.
and for the purpose of this ground "rent" means rent lawfully due from the tenant.
Some rent lawfully due from the tenant -
(a) Is unpaid on the date on which the proceedings for possession are begun; and
(b) Except where subsection (1)(b) of section 8 of this Act applies, was in arrears at the date of the service of the notice under that section relating to those proceedings.
Whether or not any rent is in arrears on the date on which proceedings for possession are begun, the tenant has persistently delayed paying rent which has become lawfully due.
NB: It is important to note that where the tenant remedies their indebtedness to the extent that it no longer meets the thresholds contemplated above as at the date of the hearing then an order for eviction will become unwarranted until the indebtedness meets the said thresholds.
Having established whether the tenant’s indebtedness meets the above criteria, the next consideration is the time frame prescribed between issuance of notice and instigation of legal action. The required notice currently depends on the degree of indebtedness of the tenant. This is encapsulated as follows:
Time of Year, Reason with Period of Notice in 2020 in London
Once the above requirements are met legal action for eviction can be instigated using either the section 8 procedure or section 21 route or both. The section 21 route though onerous is advantageous in that it allows the landlord to claim possession without the need to cite grounds. However, the section 8 route is usually faster than the section 21 route given the often-shorter periods of notice synonymous with a section 8 notice. Even better is pursuing both routes as the two will run simultaneously thereby giving the landlord more prospects of success in prosecuting eviction. As landlord lawyers, we prefer using both notices. We discuss this in more detail in a separate article.
If you wish to seek clarity regarding the best way to proceed, feel free to get in touch with us. Our lawyers are committed to helping you. Contact us for a free consultation with one of our expert lawyers.
- Julie Condliffe (SRA Regulated Solicitor, SRA ID : 518637)
There are very few lawyers who do lease options. There are also a handful of law firms that do lease options and creative deals, Julie Condliffe is one of the few lawyers in London specializing in lease options, rent to rent, delayed completion and other creative property investment strategies. In this article, we cover some of the topics involved with Lease options, lease option agreements and purchase lease options. For the avoidance of doubt, this is not lease option legal advice.
What is a lease option?
A lease option is a legal agreement allowing you to take control of a property you do not own and generate an income from it without the obligation to buy it. You have the option to purchase, but not an obligation to buy. You have a lease (sometimes a tenancy/management agreement) and an Option to buy. The word “lease’ is often used loosely in residential purchase lease options. A lease option has two primary parts: the lease and the option.
Do you need a lease option agreement?
If you are entering into any legally binding agreement in London , it is always advisable to have a written agreement. Written agreements avoid unnecessary wrangles associated with verbal contracts. Lease options are no exception. It is even more critical in property matters where there is a requirement for the contract to be in writing. So, do you need a lease option agreement to be in writing. Yes. I would go as far as stating that when you do a lease option, it is imperative to get a lease option lawyer. The lawyer must be a lease option lawyer: that is, a lawyer experienced in lease option matters. A lease option lawyer’s fees will range from £550 to £1,200, mainly dependent on location and experience. It is equally important for the seller to obtain independent legal advice and representation.
Are lease options legal in the UK?
Most lawyers in London frown upon lease options. Is that because they are unlawful? Are lease options legal? Are they legally enforceable? These are some of the many questions people ask when it comes to lease options. The short answer is, it depends. That is because three questions have been asked. Let us explore each of them in turn:
Lease option heads of terms To help the solicitors understand details of what the parties agreed, it is prudent to agree on heads of terms. Heads of terms are simply a document outlining what the lessee (buyer) and the lessor (seller) have agreed. It is that simple. You could write it on the back of a fag pack. As an afterthought, that might not be the best idea. In a nutshell. Heads of terms for a lease option agreement could include:
The heads of terms must be an accurate representation of what has been agreed. It will help your lease option lawyers and the sellers’ lawyers to draft a bespoke lease option agreement that is fair. A summary of the key points: Lease options are legal. Please use an experienced lease option lawyer. The same lease option concept is akin to that utilized in shares, cars and property development land or property. But, in property, there are specific requirements, which a lawyer should be able to help with. It is advisable to have a lease option lawyer for the purchaser and a lease option lawyer for the buyer. A Lease Option is a method of securing a future sale of the property. Under a lease option, the seller agrees to sell – usually at a fixed price - to the purchaser at a later date. In the interim, the purchaser has what is called the Lease Option for a defined period. At the end of the defined lease option period, the buyer has an option complete or to walk away. Indeed, the buyer has an option to walk even before the end of the lease option term if experienced lawyers carefully draft the agreement.
As a side note, it seems lease options work particularly well in high capital growth areas such as London. Of course, not just in London. We are only using London as an example. It is worth mentioning that not every place in London falls within this bracket. As with any other cities, London has excellent capital growth areas and other not so great areas. That is where your due diligence comes into play. For the avoidance of doubt, London is not the holy grail of lease options, but it is an area worth considering. The views articulated in this article are subjective. Nothing contained in this article constitutes advice, legal, financial, investment or otherwise. I would love your views on lease options generally and your experience.
Have lease options worked for you?
Would you consider Lease options?
If you are already doing lease options, which areas are you operating in?
If you are doing lease options in London, please let us know.
If you think I am biased towards London, let me know
- Julie Condliffe (SRA Regulated Solicitor, SRA ID : 518637)