What the Renting Homes law means for landlords and how you rent out properties.
The Renting Homes (Wales) Act 2016 simplifies how you rent properties. There are 2 types of landlord under Act:
- community landlords (primarily local authorities and registered social landlords)
- private landlords (all other landlords)
Tenants and licensees are called contract-holders under the Act. Contract-holders have occupation contracts (which replace tenancy and licence arrangements).
There are 2 types of occupation contract:
- Secure contract: for use by community landlords
- Standard contract: this is the default contract for the private rented sector (PRS) but can be used by local authorities and Registered Social Landlords in certain circumstances (for example a supported standard contract within supported accommodation)
There are 4 types of terms that can feature in occupation contracts:
- Key matters: the names of the parties and address of the property. These must be inserted in every contract.
- Fundamental Terms: cover the most important aspects of the contract, including the possession procedures and the landlord’s obligations regarding repairs.
- Supplementary Terms: deal with the more practical, day to day matters applying to the occupation contract. For example, the requirement for a contract-holder to notify the landlord if the property is going to be empty for 4 weeks or more.
- Additional Terms: addresses any other specifically agreed matters, for example a term which relates to the keeping of pets. Any additional terms must be fair, as required by the Consumer Rights Act 2015.
You are required to issue a written statement of the occupation contract to all contract-holders (this replaces your current tenancy or licence agreement). The written statement must contain all the terms of the contract.
For new rentals after the implementation date, the written statement must be issued within 14 days of occupation under the contract. Existing tenancy agreements converted to the relevant occupation contract on the day of implementation and you have a maximum of 6 months to issue a written statement of the converted occupation contract to your contract-holders. The written statement can be issued in hardcopy or electronically (if the contract-holder agrees).
You will need to bear in mind the following matters.
Repairs and fitness for human habitation
You must make sure homes are fit for human habitation, that is safe to live in. For example by fitting working smoke and carbon monoxide alarms and having an electrical safety test done. Rent will not be payable for any period during which the property is not fit for human habitation.
You must keep the structure and exterior of the property in repair and keep installations for the supply of water, gas or electricity, for sanitation, for space heating, and hot water in repair and proper working order.
If you issue a no fault possession notice in response to a request for repair (commonly known as retaliatory eviction), the court can refuse to make a possession order and it will not be possible to issue a further no fault notice until 6 months later.
Notice periods to end contracts
Where the contract-holder has breached the occupation contract the minimum notice period that must be given is one month. This notice period can be shorter where it relates to a breach of the anti-social behaviour or the serious rent arrears terms.
Where a no fault notice is issued, the minimum notice period that must be given is 6 months.
You cannot give such a notice:
- until 6 months after the contract starts
- unless you have complied with certain obligations, including registration and licensing with Rent Smart Wales and deposit protection rules
Landlord break clauses can only be incorporated into a fixed term occupation contract if the contract has a fixed term of 2 years or more. A landlord cannot exercise a break clause within the first 18 months of occupation.
A joint contract-holder can leave a contract without ending the contract entirely.
New joint contract-holders can be added without having to end the current contract and start another one.
Enhanced succession rights
Both a priority and reserve successor can succeed the occupation contract. This allows 2 successions to the contract to take place, for example a husband or wife followed by another family member. There is also a new succession right for carers.
You are able to repossess an abandoned property without needing a court order, after serving a 4 week warning notice and carrying out investigations to be sure the property is abandoned.
Supported accommodation (community landlords and charities only)
If you provide supported accommodation (sometimes referred to as supported living) you will not have to issue an occupation contract for the first 6 months of occupancy
To be classified as supported accommodation, support services in the form of advice, training, guidance or counselling must be provided. 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 6 months, the person(s) will become entitled to a supported standard contract. The supported standard contract operates in a similar way to the standard contract. However you may include terms in the contract relating to:
- the ability to relocate the contract-holder within the building
- the ability for the landlord to temporarily exclude the contract-holder from the dwelling for up to 48 hours, a maximum of 3 times in 6 months.
Please refer to the temporary exclusion guidance for further information.
You may also find it useful to read the frequently asked questions for landlords document which gives more information on subjects such as notice periods for evictions.