Landlords must get ready for the forthcoming housing law changes

Legislation which fundamentally changes how landlords operate in Wales will soon be in force.

The Welsh Government has described the Renting Homes (Wales) Act 2016 as “the biggest change to housing law in Wales for decades”. It is designed to simplify housing law and make it easier for tenants to rent a home.

While the new law has been pushed back from 15th July 2022 to 1st December 2022 (in response to unprecedented pressures faced by private and social landlords due to Covid and housing Ukrainian refugees), this still only leaves a short time for landlords to get ready.

If you are a landlord operating in Wales, what do you need to know about the new legislation?

There will now be two types of landlords

Under the Welsh-wide law, there will be two types of landlords. Private landlords who rent out private property and community landlords (local authorities and registered social landlords).

Tenants will become ‘contract holders’

Tenants and licensees will be ‘contract holders’, and the agreement between the landlord and tenant (or licensee) will be called an ‘occupation contract’. Community landlords will provide ‘secure occupation contracts’, and private landlords will enter ‘standard occupation contracts’.

The terms of a standard occupation contract must include:

• Key matters. The names of the parties and the address of the property.
• Fundamental terms. Essential matters such as possession procedures and the landlord’s repair obligations
• Supplementary terms. The practicalities of the contract. For example, that the contract holder needs to notify the landlord if the property will be empty for four weeks or more.

The terms may also include:

• Additional terms. Matters agreed between the landlord and the contract holder. For example, if the contract holder is allowed to keep a pet. These terms must comply with section 62 of the Consumer Rights Act 2015.

Private landlords must provide all contract holders with a written statement that sets out the terms of the contract.

Existing tenancy agreements will convert to an occupation contract on the day of implementation (currently 1st December 2022). For rentals entered after this date, landlords must issue the written statement within 14 days of occupation. The statement can be provided in hardcopy or by email if the contract holder agrees.

Any landlord who fails to fully meet this obligation within the required time will face penalties.

Ending occupation contracts

Under the new rules, how a landlord can end a tenancy will also change. Where a no-fault notice is issued, the landlord must provide a minimum notice period of six months, which cannot be given until six months after the contract starts. In addition, such notice cannot be issued if the landlord has not complied with specific obligations (registration, licensing, deposit protection, health & safety, etc.).

Where the contract holder has breached the occupation contract, the minimum notice period that a landlord can give is one month (this can be shorter if the breach concerns antisocial behaviour or serious rent arrears).

A fundamental change in the legislation relates to joint contracts. Currently, if an agreement ends, this applies to all tenants. But under the new rules, a joint contract holder can leave a contract, and new joint contract holders can be added, without a fresh agreement.

Housekeeping for landlords

The new legislation requires landlords to ensure that homes are fit for human habitation (FFHH). This includes carrying out electrical safety testing and providing working smoke alarms and carbon monoxide detectors.

Landlords will also have to continue to keep dwellings in repair. And under the Act, this will include:

• The structure and exterior of the property (including drains, gutters, and external pipes)
• Service installations (e.g., hot and cold water, sanitation, gas, and electricity)

Landlords cannot make contract holders pay for repairs (where the repair is not their fault), and they cannot evict a contract holder just because they have complained about the condition of a property.

While landlords have welcomed the delay in implementation, they should not be complacent. To ensure that they meet their obligations and avoid penalties, landlords should familiarise themselves with the guidance ASAP.