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All landlords need to know about Rent Smart Wales

Apr 17th 2023

The Renting Homes (Wales) Act of 2016 - which became law in December 2022 - simplifies the way in which landlords and residential occupiers rent homes in Wales. Find out more in our comprehensive article.

The Renting Homes Act Changes the Way You Rent Smart Wales

The Renting Homes (Wales) Act of 2016 came into force on 1st December, 2022 and simplifies the way in which landlords or letting agents can let a property.

There are now significant consequences for non-compliance, including financial penalties so it is imperative that you understand your obligations.

If you were issued with a licence after 1st July 2020: you will need to now complete by the 28th February 2023, the Renting Homes (Wales) Act CPD module (with RSW or any approved provider).

If you are obtaining a licence now (after the 1st December 2022) (either a new or renewed licence, where your first licence was issued before 1st July 2020): you will have a condition on your next licence to advise that Renting Homes training is required to be completed within 3 months of obtaining your licence.

However, if you complete licensing training after 1st December 2022 you will have already met this obligation as all training on offer by Rent Smart Wales and its approved providers will be updated to reflect the new Renting Homes content.

The principal changes are as follows:

  • Tenancy agreements are now replaced by Occupation Contracts.
  • Contracts must be in writing and not verbal.
  • Six months’ notice must be given to the contract holder if the contract is not breached.
  • The prevention of retaliatory evictions.
  • Additional safety for contract holders including operational smoke alarms and testing for electrical safety.
  • A fair approach to antisocial conduct for everyone.
  • Increased rights to transfer property to your successors.
  • Additional assistance for the repossession of abandoned homes.

Contract Terms:

The Act mandates that all landlords provide the occupant with a “written statement” of the occupancy agreement. Unlike in the past, when a tenancy consisted of a list of agreements, the new standard contract classifies and standardises these ‘terms’ and makes them simpler for all parties to comprehend.

The following key matters must be included in all standard occupation contracts:

  • The address of the dwelling
  • The occupation date (the date from which the contract-holder is able to occupy the property)
  • The amount of rent or other consideration
  • The rental period (eg. weekly or monthly)
  • Whether the contract is periodic or a fixed term
  • If a fixed term, how long does the contract run for (start and end date).
  • Any periods during which the contract-holder is not entitled to occupy the property as a home (for example, to allow university landlords to use their student accommodation for other purposes during non-term time).

Fundamental terms

These fundamental terms are set out within The Act and cover the most important aspects of the contract, such as possession procedures and the landlord’s obligations regarding repairs at the property.

In the model contract, any fundamental terms that cannot be left out of the contract or changed have (F) added after the term sub-heading.

Fundamental terms that can be left out or changed (but only by agreement with the contract-holder and to their benefit) have (F+) added.

Where a fundamental term has been left out or changed, this must be identified in the written statement.

Below are examples of terms that can never be amended or omitted, so you will find them in all standard contracts.

Supplementary terms

These supplementary terms deal with the more practical, day-to-day matters applying to the occupation contract, for example, the requirement to pay rent on time or taking care of the property.

In the model contract, any supplementary terms have (S) added.

Supplementary terms cannot be removed or modified in a way that would make them incompatible with a fundamental term.

Where a supplementary term has been left out or changed, this must be identified in the written statement.

Additional terms

Additional terms are provisions agreed upon by both parties to the contract (private landlord and contract-holder) and they cover any other matter that does not fall under key matters, fundamental or supplementary terms.  They must not conflict with a key matter, a fundamental term, or a supplementary term.

Under section 62 of the Consumer Rights Act 2015, an additional term, or any change to a supplementary term, which is unfair (within the meaning of that Act), is not binding on the contract holder.

Examples of Fundamental Terms

F • Requirement to use a deposit scheme (if deposit taken) • Anti-social behaviour and other prohibited conduct • Variation of periodic or fixed term standard contracts • Permissible reasons to terminate a contract • Possession claims • Death of sole contract-holder • Restrictions on giving landlord’s notice for possession under specific grounds such as failure to provide a written statement or failure to provide a gas safety certificate. F+ • Variation of rent • Landlord’s right to enter the dwelling for repairs • Restriction on giving landlord’s notice for possession under a periodic standard contract during first six months of occupation.

Examples of Supplementary Terms

Inventories: Provide a written inventory to the contract holder within 14 days and give 14 days for comment agreement. No response = it is agreed. Comments = respond back within 14 days. Changes to Dwelling: alteration such as fixtures, fittings, satellite dish, aerial, shed, garage or other structures at the property, external decoration. Landlord’s right to enter in an emergency ie. flood, gas leak, fire. Landlord’s right to enter for repairs to the dwelling: 24 notice required. Contract-holder’s obligations at end of the contract eg. returning keys. Duty to take care of the property above fair wear & tear, eg. not to remove fixtures or fittings without permission of the landlord and keeping the property in good decorative order.