Renting in Wales is changing this year. The original plans were for July 2022, but have been postponed to December 2022. The Renting Homes (Wales) Act will come into force, aiming to make renting easier for everyone. The law brings various changes across the rental process, including new occupation contracts, changes to evictions and increased safety requirements for rental properties.
- What is the Renting Homes (Wales) Act?
- What are the new occupation contracts in Wales?
- When do I need to switch to an occupation contract?
- What are the new rules for joint contracts in Wales?
- What are the new rules for succession?
- How are Welsh evictions and notice periods changing?
- What are the new rules for abandoned properties?
- What are the new safety requirements in the Renting Homes Wales Act?
- What are the legal requirements for EICRs in Wales?
- How will the Act affect supported accommodation?
What is the Renting Homes (Wales) Act?
The Renting Homes (Wales) Act 2016 is a new housing law coming into force in December 2022. The legislation, originally planned for July 2022, seeks to ‘simplify renting’ for both landlords and tenants, clarifying rights and responsibilities and increasing protection for renters.
The government considers it “the biggest change to housing law in Wales for decades”, including changes to tenancy agreements, eviction notices, safety requirements, and even getting rid of the word ‘tenant’.
Renting in Wales – Tenancy agreements replaced by occupation contracts
One of the main changes the Renting Homes (Wales) Act will bring is the replacement of tenancy agreements. Instead of a tenancy agreement or licence arrangement, there will be occupation contracts.
Landlords will be split into two types. Registered social landlords and local authorities will be referred to as community landlords. All other landlords will be deemed private landlords.
Tenants and licensees will now be collectively referred to as contract-holders and will have an occupation contract. There are two types of occupation contracts.
This will be the default contract for private landlords but can be used by local authorities or social landlords in certain situations
For community landlords.
What will the new Wales occupation contracts include?
Occupation contracts will function in the same way as a tenancy agreement. There are four types of terms that can be included.
These are the names and addresses of all parties and must be included in every contract.
These are all the legal requirements and procedures that apply to the contract, such as eviction processes and the landlord’s safety responsibilities.
These are related to practical, day-to-day matters. For example, the contract-holder must notify the landlord if the property is going to be empty for longer than a month.
These are terms that relate specifically to this contract, such as keeping pets or parking restrictions. These terms must be reasonable and fair, in line with the Consumer Rights Act 2015.
The occupation contract will be set out in a written statement and must be signed. Landlords (or their managing agents) are responsible for presenting the written statement to all contract-holders.
When do I need to switch to a Renting Homes (Wales) Act occupation contract?
For new rental contracts after December 2022, the written statement must be issued to the contract-holder within 14 days of occupying the property.
Existing tenancy agreements will automatically convert to the relevant occupation contract on 1 December. Landlords and managing agents have a maximum of 6 months to issue a written statement of the converted occupation contract to their contract-holders. This can be a hard or digital copy.
Renting in Wales and joint contracts
When the Renting Homes (Wales) Act comes into force, a joint contract-holder will be able to leave a contract without ending the entire contract. New joint contract-holders can also be added to an existing contract, without ending it and starting a new one.
Renting in Wales and succession rights
The new legislation enables contract-holders to have a ‘priority’ and ‘reserve’ successor to take on their occupation contract if they pass.
A person is a priority successor if they are a spouse or live with the contract-holder like a spouse and they occupy the property as their only home.
If the contract-holder takes on the property as a priority successor, then there is no further priority successor in relation to the occupation contract.
A person is a reserve successor if they are not the priority successor, but are a family member, live in the property as their main home, or occupied the property during the 12-month period before the contract-holder’s passing. Successors must be over the age of 18.
Carers can also be reserve successors. To qualify, a person must either be a carer for the contract-holder or for someone who lived with the contract-holder. They must also live at the property as their main home at the time of the contract-holder’s passing.
Read more about Renting Homes Wales Act and succession rights.
Renting Homes (Wales) Act – Changes to evictions and notice periods
Ending a tenancy is also changing. If a contract-holder breaches the occupation contract, the minimum notice period a landlord can give is one month. The notice period can be shorter for serious rent arrears or anti-social behaviour.
No-fault evictions, previously known as a Section 21, have a minimum notice period of six months. No-fault notices cannot be issued until six months after the contract starts.
Landlords will not be able to issue a no-fault notice if they haven’t complied with certain requirements, including registration and licensing with Rent Smart Wales and correctly protecting the deposit.
Read the full legislation on terminating a contract here.
Renting in Wales and break clauses
As of 1 December 2022, break clauses can only be added to occupation contracts with a fixed term of 2 years or more. Landlords will not be able to exercise the break clause within the first 18 months of occupation.
Renting Homes (Wales) Act and abandoned properties
The Renting Homes (Wales) Act will make it easier for landlords to gain possession of their abandoned properties. If a contract-holder abandons a property, the landlord can serve a four-week warning notice and will not need a court order to get the property back.
The warning notice must:
- State that the landlord believes the contract-holder has abandoned the dwelling
- Ask the contract-holder to inform the landlord in writing if they have not abandoned the property before the end of the warning period
- Inform the contract-holder that the landlord will be ending the contract at the end of the warning period if the landlord is satisfied that the contract-holder has abandoned the property
Landlords must make necessary investigations to determine whether the contract-holder has abandoned the property. The warning notice must also be provided to any lodger or sub-holder of the contract-holder.
Fitness for human habitation and the Renting Homes (Wales) Act
The Renting Homes (Wales) Act places clear responsibilities on landlords to keep their rental properties safe and fit for human habitation. Rent will not be payable for any period during which the property is not fit for human habitation.
The structure and exterior property must be kept in good repair, and water, gas and electricity installations must be in good working order.
To meet these requirements, landlords must also:
- Have working smoke alarms fitted on every floor
- Have working carbon monoxide alarms fitted
- Arrange electrical testing and get a valid EICR
If a landlord issues a no-fault possession notice in response to a repair request from the contract-holder (otherwise known as a retaliatory eviction) the court can refuse the possession order and another cannot be made until 6 months on.
Renting in Wales and electrical inspections
As of 1 December 2022, all rental properties will require a valid electrical installation condition report (EICR). The Renting Homes (Wales) Act is making electrical inspections mandatory every five years. This involves a qualified electrician visiting the property, assessing the wiring and installations, then issuing a report.
If the property fails the inspection, the landlord must arrange the recommended remedial work to make the property safe and receive a valid EICR. The EICR must be given to tenants within 7 days of being issued – or at the start of the contract if they’re a new contract-holder.
For tenancies turning into occupation contracts, landlords have a year to comply with electrical safety and smoke alarms requirements.
Renting Homes (Wales) Act and supported accommodation
If you provide supported accommodation, sometimes referred to as ‘supported living’, you will not have to issue an occupation contract for the first six months of occupancy.
Supported accommodation must include support services in the form of advice, training, guidance or counselling. Support services include:
- Support in controlling or overcoming addiction
- Support in finding employment or alternative accommodation
- Supporting someone who finds it difficult to live independently because of age, illness, disability or any other reason
After six months, they will become entitled to a ‘supported standard contract’. The supported standard contract will operate in a similar way to a standard contract, however, can include terms relating to:
- The ability to relocate the contract-holder within the building; and
- The ability for the landlord to temporarily exclude the contract-holder from the dwelling for up to 48 hours, a maximum of three times in six months
What do you think?
The Renting Homes (Wales) Act will be making significant changes for landlords and renters in Wales, but what are your thoughts on the new legislation? Let us know in the comments below.