Margaret Thatcher's legacy can still be felt in today's "revenge evictions" controversy.
By the time she'd served nine years as Prime Minister, Margaret Thatcher had succeeded in scaling back the British government's role in the economy. Industries were liberalized and opened to foreign investment. The power of trade unions and collective bargaining were diminished. And in 1988, Thatcherism was bent on upending another leg of the British economy: Its moderately progressive housing sector.
At the time, the power of landlords was curtailed by pro-tenant regulations safeguarded in the 1977 Rent Act. Under the legislation, most private sector rentals were eligible for "Fair Rent" assistance; essentially, rent control. U.K. officials—called Rent Officers—would arbitrate a price between homeowner and occupier, which was often "way below market rents," according to Tony Manzi, an urban development lecturer at the University of Westminster in London. Moreover, the Act outlined 16 specific violations that permitted eviction. If a tenant had refrained from committing a violation, their residency was fully protected. These handicaps were irritating to London property owners because of the capital city's valuable market. The housing sector's power dynamic shifted dramatically in their favor, however, in 1988.
Written into the Housing Act of 1988, the Section 21 amendment repealed many of the eviction protections found in the old legislation (the Act also reformed the eligibility of price controls, limiting them to low-income earners eligible for "social rent"). This reversal of Britain's housing policy—from pro-tenant to pro-landlord—has stayed mostly intact up until today. Presently, U.K. landlords renting property built after January 15, 1989, can issue an eviction letter without having to provide justification. Tenants can protect their residency primarily through two minor caveats: The eviction is annulled if the landlord failed to provide two months notice. Secondly, if the tenant's security deposit was not secured in a government-approved bank account, the resident may be able to avoid eviction. Otherwise, landowners in Britain have a green light to kick their tenants to the curb. Across London, this is no secret: Landords can, potentially, wield ungodly power against their tenants.
"The argument was that without these restrictions, more people would be landlords," explains Seb Klier, policy manager for Generation Rent, a pro-tenant group.
Yet, as the figure below shows, Thatcher's housing policies didn't yield their intended results, at least in London. After a short increase, the proportion of London homeowners stagnated in the early 1990s. Home ownership in London ultimately started to decline in the early 2000s; a downward trend that has lasted up until today. In fact, London's private renter class (those not receiving public housing assistance) increased as a proportion of the city's population—the first time in decades—shortly after Thatcher deregulated the housing sector. But a more recent fallout from Thatcher's housing policies is even more intriguing.
Starting roughly two or three years ago, according to tenant-rights groups, a small group of London landlords began to abuse the rights afforded to them in the Section 21 eviction amendment. Certain property owners started to evict tenants who made maintenance and repair requests, essentially sweeping health and safety issues under the rug by filling the flat with new tenants. The practice is colloquially known as a "revenge eviction," and was profiled in a recent report by the Independent.
The scale of eviction abuse is widely contested and likely pursued by only a small collection of property owners (housing advocates, lawyers, and a parliamentarian aide all acknowledged in separate interviews that measuring these so-called revenge evictions, especially in London, is a major challenge). "It's hard to say how many [evictions] relate to 'revenge' possession proceedings," says Andrew Leakey, a real estate dispute litigator with Stephensons Solicitors, a London-based law firm. (Although their numbers are going up, evictions accounted for less than 10 percent of housing relocation in London between 2010 and 2012. See chart below). Even so, Leakey habitually warns his clients that they will "potentially end up with possession proceedings," if they "complain about disrepair." A widely cited calculation by Shelter, another tenant advocacy group, estimated that 213,000 Britons were unethically evicted between 2013 and 2014.
MP Sarah Teather, who represents the Brent Central district of London, has submitted legislation that aims to eliminate hostile evictions. If enacted, Teather's bill would nullify an eviction proceeding if the tenant can prove his or her landlord acted with malicious intent. "If a tenant can basically prove [the eviction] is retaliatory, then the landlord won't be able to use the Section 21 notice, in that case, to get their property back," explains Jonathan Featonby, an aide to Teather. Yet even if this sort of reform were passed into law, London's eviction protocols would remain out of step with other European—and even American—cities.
Strict housing laws in France, for instance, require landlords to hire housing specialists—called huissiers—to coordinate the eviction process. If an eviction does reach the level of a court hearing, it typically involves months of proceedings and appeals (and the tenant remains in the home throughout the legal debate). In fact, a squatter in Paris that occupies a space for 48 hours cannot be forcibly evicted.
Eviction regulations in San Francisco, like many large U.S. cities, are similarly designed to protect tenants. A large proportion of San Francisco residents live in rent-controlled dwellings (those built before June 13, 1979). For a landlord to evict someone from a rent-controlled property, they must prove, in court, that the tenant broke one of the 16 "Just Causes" for eviction—grievances like the failure to pay rent or breach of contract (similar to Britain's now defunct 1977 Rent Act).
Andrew Leakey, the London-based real estate lawyer, contends that the U.K.'s current laws work against the needs of the average Briton.
"[The Section 21 amendment] doesn't make for a stable housing market. It doesn't make for stable schooling or child welfare. And the major problem we've got across the U.K. is a shortage of affordable rental housing," Leakey says. "It's very easy for a landlord to say 'you're not paying enough ... I'm getting you out.'"
The median rent for a one-bedroom unit in the British capital is now more expensive than the national average for a four-bedroom unit, according to a 2014 report by the London Mayor's office. And the city's population is expected to grow by an additional 2 million residents by 2021. Property demand—and the cost of rent—will undoubtedly rise. If rent inflation, as Leakey alludes, is a catalyst for revenge evictions, the controversy is unlikely to subside any time soon.