Skip to main content

Housing: Repossession

Volume 710: debated on Monday 18 May 2009


Asked By

To ask Her Majesty’s Government what protection is available to tenants of private landlords subject to repossession proceedings.

My Lords, I share the concern of the noble Baroness about the problem of tenants who are evicted at very short notice when, through no fault of their own, their landlord is repossessed. We announced on 13 May that we intend to legislate to provide additional protection for tenants caught in this situation and we will shortly be consulting on the details.

My Lords, I am grateful to the noble Baroness for that reply. Is she aware of stories from Citizens Advice of individuals coming out of hospital to find that the locks have been changed on their property because it has been repossessed? Will the changes to which she refers include giving courts the power to defer the possession order to give time, particularly for vulnerable tenants, to make alternative arrangements?

My Lords, I have certainly seen the Shelter report, which has many of the same sort of stories about people who return home to find that the locks have been changed or who are given very little notice to find alternative accommodation. We think that this involves a small minority—about 2,000 people—but that does not make it any less unjust. The problem is that the landlord has not informed the lender that they have sublet their property and so the tenants have no tenancy rights. We plan to legislate at the earliest opportunity for the tenants affected, so that we can ensure that all tenants in this situation get at least two months’ notice if they need to leave their home for any reason. That would put them on the same footing as other tenants. We are now discussing with lenders and the debt and housing advice providers how to change the law to best effect.

My Lords, I declare my interest as chairman of the Property Ombudsman Council, which deals with complaints against estate agents and the managing agents and letting agents of private landlords. I am much encouraged by the Minister’s response, but are the Government addressing the parallel issue of evictions under Section 21 of the Housing Act 1988, which allows landlords to evict people who complain? While that provision remains, it is difficult for a complaints and redress scheme to work properly, as the landlord can evict the tenant who complains. Is the Minister aware that in America, where the private rented sector is much further advanced, that problem has been overcome?

My Lords, I am very interested to hear what the noble Lord has said about American practice; I did not know that. The context for this is the Rugg review, which last week published its report on the private rented sector. It recommended among other things the idea of a lighter-touch national register of every private landlord in the country. That would increase protection both for vulnerable tenants and for good landlords, which is the solution that we are looking for. When the Rugg review looked at this problem, it found not that the problem is widespread but that the real issue is how to raise standards in the private sector. If properties were properly maintained, the problem of retaliatory eviction would not arise. We will look at this in that much broader context.

My Lords, as the Minister has said, a lot, if not most, of the problem applies to sub-lessees, many of whom will be on housing benefit. In these cases, will their housing benefit be affected, or will they have to start again with a new claim?

My Lords, I am not properly briefed on that, but my sense is that their housing benefit would be protected. This would happen through no fault of their own. If the noble Lord will forgive me, I will write to him.

My Lords, I appreciate that the noble Baroness cannot commit to the date of legislation, but she will appreciate that those who are concerned about the problem are also concerned about having to wait until the Queen’s Speech in the autumn and then for new legislation. Will the Government see whether there is current legislation on to which they can add some of these provisions? In the mean time, will they talk to the relevant parties about the pre-action protocol and steps that the courts may or may not take?

My Lords, I cannot pre-empt any legislative vehicle, for the reasons that the noble Baroness gave, but we will certainly find the first relevant legislation that we can. We have to consult properly because this is a complicated situation, as she will know, given her experience. Tenancy agreements are very complicated indeed. We have to work—and we are working—closely with lenders, who have been very supportive on this, as have the lobby groups. We need to improve the current practices when an unauthorised tenant is found in the property. We are working to mitigate the impact on tenants whose landlords are in arrears. For example, in April we extended the period of the possession order to seven weeks, which will help. We will try to get as much information as we can to tenants who may be vulnerable, but the difficulty is in finding them.

My Lords, is the Minister aware that there used to be a parallel situation with utilities, such as gas and electricity? People would find the bailiffs coming because the man who owned the whole block had not paid his bills or done anything about them. This was resolved with the utilities by agreeing a code of conduct with them, so that they would check whether there were tenants in a property; if there were, the utilities would notify the tenants and, in some cases, accept payment—even the landlord’s payment—directly from the tenant. Perhaps something of that type could be brought in.

My Lords, I am learning a lot in the course of this Question. I am grateful to the noble Baroness for that interesting information, which should go into the consultative process. If there is some way of solving this, we need all the help that we can get.

My Lords, is the new legislation to be confined to England, or are Scotland, Wales and Northern Ireland also to be kept in tow on this?

My Lords, my best advice is that it applies to England only, but I will write to the noble Lord if I am wrong.

My Lords, is not the scale of this problem growing dramatically, with repossessions rising by 50 per cent in the first quarter of this year? Are there not two simple further methods that the Minister could use? The first would be to ensure that the tenants have a right to appear at a court when a repossession case is being heard against their landlord. The second would be to allow tenants to remain in a repossessed property under licence, pending the sale of that property.

My Lords, those are two interesting suggestions, which I will refer to the consultative process. As for where we are with houses that are being repossessed, it is quite interesting that the CML, which suggested that there would be in the order of 75,000 repossessions this year, is phasing its figures down. In the first quarter we saw only 12,000 repossessions. That is still a significant number, but maybe not as many as we thought.