Renting Homes (Wales) Act 2016: What landlords need to know
After a six year wait, the Welsh Government has announced that the Renting Homes Wales Act will come into force on July 15 2022.
This legislation fundamentally changes how landlords operate in Wales, with all PRS tenancies replaced by ‘occupation contracts’ with new required terms and rules around repossession.
This means that from July 15 2022, Wales will have a largely self-contained set of laws that will sometimes share similarities with England.
Landlords with properties in Wales will need to be aware of all of the changes and update their properties and their documents accordingly.
The Welsh Government has produced some supplementary legislation and guidance on the changes for landlords and tenants.
Commenting on the announcement of the implementation date for the Renting Homes (Wales) Act 2016, Chris Norris, Director of Policy & Campaigns at the National Residential Landlords Association, said:
“With the Welsh Government now moving forward with its plans to implement the Renting Homes Wales Act, there is still a pressing need for more clarity as to what the supporting framework of the Act looks like.
“The extent of landlords’ future obligations under this legislation also underlines how crucial it is that existing legislation be made fit for purpose before new regulations are introduced.
“While we welcome the introduction of the Act, it is vital that the supporting legislation is fit for purpose and scrutinised sufficiently. In particular, the occupation contract terms, which all landlords must use, needs to improve significantly from its original consultation draft.
“These important steps must be taken before more complex regulations are introduced by the Welsh Government over the course of this year”
Occupation contracts
From July 15, existing tenancies will be converted into the new standard occupation contracts where the tenant becomes a ‘contract holder’. These contracts have specific terms that must be incorporated.
Landlords will have to provide a copy of the new occupation contract in writing to their contract holder. For new contracts this must be no later than 15 days after the contract starts. For existing tenancies transitioning over to the new system this has to be provided no later than January 14 2023.
Ending an occupation contract
These new contracts do operate differently, most notably in the way that they are ended.
Currently, where a tenancy is ended, then it ends the agreement for all parties. As a result, if you have a joint contract for a HMO or a family breaks up then it may mean all tenants have to leave even if they don’t want to.
Under the new system, if one tenant chooses to leave then only they are removed from the contract, and the other tenants can remain on it on the same terms. Similarly, tenants can be added to the agreement mid-contract without the need for a deed of assignment.
Where the landlord wants to end the contract then both Section 21 and Section 8 notices will no longer be available. Instead, they are replaced by new notices with different rules about when they can be served. For example, the replacement for Section 21 will require a minimum of six months’ notice and cannot be served in the first six months of the occupation contract.
Safety Requirements
In addition to this, the legislation introduces a number of new safety responsibilities for landlords in Wales under the banner of new fitness for human habitation requirements.
Once the legislation comes into force, the property will be unfit for human habitation unless the landlord ensures that –
- They have had a satisfactory electrical installation condition report (EICR) performed, with a copy given to the contract holders within 7 days of occupation or the inspection taking place.
- Mains-wired interlinked smoke alarms are fitted on every floor of the property
- CO alarms are fitted in every room with a gas, oil or solid fuel burning appliance
For tenancies that turn into occupation contracts, landlords have a year to comply with the electrical safety and smoke alarm requirements, giving them until July 15 2023 to comply. Carbon monoxide alarms must be fitted from July 15 2022.
More generally, the landlord will also have an obligation to keep the property in a state that is fit for human habitation based on a number of key hazards.
Prohibitions on notice
Bringing Wales into line with England a number of new regulations will restrict the use of possession notices unless the landlord has performed certain tasks.
Landlords will also be unable to serve a notice seeking possession unless they have served –
- An energy performance certificate
- A gas safety certificate
- A satisfactory electrical installation condition report
In addition to this, if there are insufficient smoke and CO alarms in the property then a notice may not be served.
Where the courts consider that a notice has been served to avoid fulfilling the landlords obligations to repair or maintain the property in a state that is fit for human habitation this may also prevent possession being granted.
Finally
With so much changing in Wales, landlords may find it overwhelming keeping up with all the changes. Over the coming months the NRLA will be producing a number of guides and supporting documents to help landlords in Wales transition over to this new framework.
Required training
All Rent Smart Wales licensees who have received their licence since July 2020 must complete approved training by the 15 October 2022 on Renting Homes Wales because it is a condition of their, or their employers, Rent Smart Wales licence.
The NRLA has been working closely with Rent Smart Wales and is now offering approved training on the Renting Homes (Wales) Act 2016 prior to its implementation on the 15 July 2022. With several course dates in May, June and July, book your place on this course now.
