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Economic analysis shows abolition of Section 21 would devastate PRS

The private rented sector (PRS) would shrink by 20% if Section 21 ‘no-fault’ evictions are abolished, according to a new economic analysis report entitled: A new deal for renters? The unintended consequences of abolishing Section 21.

The report, which was produced by Capital Economics on behalf of the National Landlords Association (NLA), also forecasts a 59% reduction in housing available to tenants on housing benefit or Universal Credit, and a potential increase in rents for 13% of properties.

The report also suggested a possible solution in the form of a reformed court process that would make dealing with Section 8 cases faster and cheaper and could nullify the removal of Section 21 for many landlords. However, the PRS would still see a likely reduction of between 180,000-390,000 homes, between 130,000-300,000 fewer homes available to benefit claimants, and rent increases for between 110,000-240,000 properties.

Chris Norris, director of policy and practice at the NLA, said: “The Government has clearly failed to recognise the realities of the private rented sector by proposing the abolition of Section 21. Any government which thinks it appropriate to risk the loss of nearly 1m rental homes at a time of housing crisis needs to reassess its priorities as a matter of urgency.”

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