What is the Renting Homes (Wales) Act 2016?
The Renting Homes (Wales) Act 2016 is finally coming into force on 15th July 2022.
Change is a constant for landlords – from changes in mortgage tax relief to updates to Section 21. Now, after a six year wait new legislation means that Wales will have a self-contained set of laws that will change how landlords rent in Wales. So landlords in Wales have until mid-July to get their heads about these new rules!
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But are the new rules clear enough?
While Chris Norris, Director of Policy & Campaigns at the National Residential Landlords Association, welcomes the introduction of the Act, he insists that it needs to be ‘fit for purpose’:
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.
What are the new rules coming into force in Wales in July 2022?
The Welsh government has been working to produce supplementary legislation and guidance on the changes for landlords and tenants. So what exactly does it mean for everyone involved?
Existing tenancies will be converted to the new standard occupation contracts
Under the new standard occupation contracts, the tenant becomes a ‘contract holder’
Landlords must provide a copy of the new occupation contract in writing to existing tenants no later than 14th January 2023
If only one tenant chooses to leave (in the event of a break-up, for example), this doesn’t break the contract for all parties. Other tenants can remain on the same terms
Landlords must provide a copy of the new occupation contract in writing to their contract holder within 15 days of a new contract starting
Tenants can be added to the agreement mid-contract, without the need for a deed of assignment
While this may sound like a lot more trouble for landlords, the Act does also make it easier for you to repossess abandoned properties:
- 4 weeks notice. If you suspect your property has been abandoned, you’ll need to serve a 4 week warning notice of repossession
- Investigate. Reach out to your tenant and pop by to satisfy yourself that the property actually has been abandoned
- No court order needed. If you carry out the simple steps above, you can repossess your property without needing a court order
New Standard Occupation Contracts
It’s worth noting that there will be two kinds of Occupation Contracts:
- Standard Occupation Contract. This is the one you’ll use if you are renting in the private sector
- Secure Occupation Contract. You’ll use this contract if you are a community landlord (this also applies to local authorities)
These are the terms that can feature in the new contracts:
- Key Matters. These are the names of the parties involved and the address of the property and must be included in every contract for all parties involved
- Fundamental Terms. These cover the possession procedures and obligations regarding repair
- Supplementary Terms. These cover the practical aspects of the contact, like notifying the landlord if the property is going to be empty for 4+ weeks
- Additional Terms. These address specific agreements, such as the keeping of pets
If the landlord wants to end the contract, they can no longer use Section 21 or Section 8 notices, as they will be replaced by new rules under different notices. There is currently a small window in which Welsh landlords can serve an eviction notice under the old rules, but once the new rules start on 15th July, a landlord will have to provide a six month notice period, when the contract holder isn’t in breach of contract.
Landlords will also not be able to issue these repossession notices during the first six months of occupation, so contract-holders will have the minimum security of a year once they move in.
Tightening the Fit for Human Habitation Rules (FFHH)
To ensure that all properties are fit for human habitation, they must all have the following or will be deemed unfit and unavailable for rent:
- An EICR. The contract holders must receive a copy of the EICR within 7 days of the inspection. You have a year to comply with this requirement, but make sure it’s done before 15th July 2023. EICRs are a legal requirement, so you should already have this
- Smoke alarms. These must be mains-wired interlinked smoke alarms, installed on every floor. You also have until 15th July 2023 to comply with this requirement too
- CO alarms. These need to be installed in every room with a gas, oil or solid fuel burning appliance. In existing tenancies, these must be fitted from 15th July 2022 – so get in early now!
- Structure and exterior. These must be kept in good repair (make sure you have Buildings Insurance, in case of any issues!). Issues in the structure can often have knock-on effect on the interiors over time
- Proper working order. The installations for the supply of hot water, electricity and gas should be kept in good working order. Your up-to-date EICR and Gas Safety Certificates should confirm this
There is a national awareness campaign ongoing so that everyone is aware of the changes before 15th July, so if you have properties to rent in Wales, keep your eyes peeled! And if you want to know more, you can rewatch our webinar on The Renting Homes (Wales) Act & Other 2022 Reforms.