Understanding Legal and Regulatory Changes: How Leasehold Reforms and Section 21 Abolition Impact Landlords

The UK property market is constantly evolving, and staying ahead of legal and regulatory changes is crucial for landlords. Two major reforms currently shaping the rental sector are:

1️⃣ Upcoming changes to leasehold laws, which aim to make leasehold ownership fairer and more transparent.
2️⃣ The abolition of Section 21 ‘no-fault’ evictions, which will significantly impact how landlords manage tenant evictions.

At Banbury Property Management, we help landlords stay compliant with new regulations while ensuring they can manage their properties effectively. In this guide, we break down what these legal changes mean for property owners and how to prepare.

Upcoming Leasehold Reforms: What Landlords Need to Know

The UK government has been working on leasehold reform to address unfair practices, particularly around excessive ground rents, service charges, and lease extensions.

Key Changes on the Horizon

🏡 Ground Rent Abolition – The Leasehold Reform (Ground Rent) Act 2022 already bans ground rent on new leases, and further changes may extend this to existing leaseholders.
🏡 Easier Lease Extensions – Leaseholders could soon get the right to extend leases up to 990 years at fairer rates.
🏡 Right to Manage & Buy the Freehold – Reforms aim to make it easier and cheaper for leaseholders to take control of building management or purchase the freehold.
🏡 Crackdown on ‘Fleecehold’ Practices – Unfair service charges and hidden fees are being reviewed, with potential new transparency requirements for freeholders and management companies.

How This Affects Landlords

📌 If you own leasehold rental properties, watch out for upcoming changes that could reduce ground rent income and affect service charge structures.
📌 Lease extensions may become more affordable, benefiting landlords who want to secure long-term property value.
📌 Freehold buyouts could become more viable, giving landlords greater control over their investments.

💡 Banbury Property Management can help landlords navigate leasehold changes, ensuring their investments remain profitable and legally compliant.

The Abolition of Section 21: What It Means for Landlords

One of the biggest shake-ups in UK rental law is the proposed abolition of Section 21 ‘no-fault’ evictions under the Renters’ Reform Bill.

What is Section 21?

Section 21 currently allows landlords to evict tenants without giving a reason, provided they give at least two months’ notice at the end of a tenancy agreement.

What Will Change?

📌 Landlords will no longer be able to evict tenants without a valid reason.
📌 All tenancies will become periodic (rolling contracts), meaning landlords can’t simply wait for a fixed term to end.
📌 Landlords will need to rely on Section 8 notices, which require a specific legal reason (e.g., rent arrears, property damage, or selling the property).

Concerns for Landlords

🚨 Longer Eviction Processes – Landlords may face delays in removing problematic tenants.
🚨 Higher Legal Costs – Going through Section 8 may require more evidence and legal support.
🚨 Risk of Difficult Tenants Staying Longer – Without Section 21, landlords will lose flexibility in regaining possession of their property.

💡 Banbury Property Management stays ahead of legislative changes, helping landlords comply with new rules while protecting their rights.

How Landlords Can Prepare for These Legal Changes

📌 Review Existing Leasehold Agreements – Ensure your ground rent, service charges, and lease terms align with upcoming reforms.
📌 Reassess Tenant Screening Processes – With Section 21 being abolished, selecting reliable tenants becomes even more crucial.
📌 Understand Section 8 Grounds for Eviction – Ensure you know what legal reasons will be available for removing tenants if necessary.
📌 Work with a Professional Property Management Company – Banbury Property Management provides expert guidance on legal compliance, tenant relations, and risk management.

Final Thoughts: Stay Ahead of the Changes with Banbury Property Management

The UK rental sector is undergoing major legal shifts, and landlords need to adapt quickly to remain compliant and successful.

At Banbury Property Management, we use award-winning AI-driven property management software to track regulatory changes, manage tenancies efficiently, and ensure landlords are fully informed and prepared.

Are you considering Property Management? Are you looking for area specific expertise within 15 miles of the Banbury area? Please see our ‘where do we service’ page to find out if you are within our catchment area.

Equally, please take the time to explore our services and see if we are a good fit for you.