On July 15th this year the law in relation to renting in Wales will change. The Renting Homes (Wales) Act will come into force on that day and will affect landlords and tenants both current and prospective.
The aim of the Act is to make renting easier for everyone but it does add new duties for landlords as well as new terminology. Tenancy Agreements are out and Occupation Contracts are in. Tenants and licensees are now to be called contract holders and landlords are split into two categories of community landlords (currently the local authority and registered social landlords) and the second category will be known as private landlords. The law on evictions and safety requirements will also change. It has been described as one of the biggest shake ups in housing legislation for decades.
Section 21 no fault evictions will now have a 6 month notice period attached to them and any other evictions unless for serious rent arrears or for anti social behaviour (where the period can be shorter) will require at least a 1 month notice period. The new Act will place a heavy responsibility on the landlord to ensure that the let property is safe and fit for human habitation and this will include smoke alarms to be fitted on every floor and regular electrical testing following receipt of a EICR (electrical installation condition report). All in all it’s a win for the tenant or contract holder
Click the image above to read the government guidelines on the new Welsh laws that are planned to change the way landlords rent their properties from 15 July 2022.
Importantly for PLG’s clients the new legislation enables contract-holders to have a priority and reserve successor to take on their occupation contract if they pass away.
A priority successor has been defined as a spouse or someone who lives with the contract-holder like a spouse and they occupy the property as their only home. There can only be one priority successor so if the contract holder takes on the property in the capacity as priority successor there cannot be another priority successor in relation to that occupation contract.
A reserve successor is defined as someone who is not the priority successor, but is a family member. They must have lived in the property as their main home, or occupied the property during the 12-month period before the contract-holder’s death and must be over the age of 18
Importantly for PLG clients, carers can also be reserve successors. To qualify, a person must either be a carer for the contract-holder themselves or for someone who lived the contract-holder. They must also live at the property as their main home at the time of the contract-holder’s passing.
This will therefore give additional rights to those who have cared for members of their family and give them additional protection.
The Act will also safeguard tenants or contract holders by not allowing a landlord to exercise a break clause in the occupation contract within the first 18 months of that contract and will also prevent any contract from having a break clause if it is for less than 2 years. Again the tenant or contract holder will have that greater degree of protection.
It is fair to say that there is not much in this new Act to help landlords although they will be able to access their own abandoned properties more easily. There is however a lot to protect the contract holders or tenants and it remains to be seen if the addition of further burdens for the landlord to satisfy will affect their willingness to continue to let property or simply sell up. Any reduction in the number of properties to let at present would be keenly felt in the already over-heated rental market, not least by those who want to rent a property.
It will be worth watching this closely to see how things pan out as it is likely that similar changes could be on the way for the rest of the United Kingdom. As we’ve already mentioned, a lot of this legislation is going to be good for the tenant but in a market place where landlords are already being squeezed on several fronts many are already looking to sell up and invest their equity in other areas. If this proves to be the case on an even greater scale we could easily see a situation where the very legislation that was intended to make things better for tenants actually has an opposite effect as there could be less properties available and even more people chasing them.
Time will certainly tell.