Wales – The PRS in 2016 and Beyond

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A lot of change is happening in Wales this year, and it is important that landlords stay up to date. Below are the main issues of which members with property in Wales should be aware.

Rent Smart Wales

Rent Smart Wales is the mandatory landlord and letting agent registration and licensing scheme launched on 23 November 2015 and it covers the whole of Wales.

Administered by Cardiff City Council, and brought in under the Housing (Wales) Act 2014, the scheme is mandatory throughout the country.

If you are a landlord with property in Wales you need to register, and may also need to become licensed if engaged in any letting or property management activities. This has to be done before 23 November this yearvisit the website here to apply.

Renting Homes (Wales) Act

The Renting Homes (Wales) Act 2016 was granted Royal Assent on 18th January 2016, although the provisions will come into force at a later date decided by the Welsh Government. This will likely occur later in the year.

One of the most significant pieces of legislation to be passed by the National Assembly for Wales, the Act will:

  • replace the majority of current tenancies and licences with just two types of contract – one for the private rented sector and one for social housing
  • require landlords to issue a written statement of the contract which clearly sets out the rights and responsibilities of both landlords and tenants
  • require landlords to carry out repairs and ensure rental properties are fit for human habitation. It will also help protect people from being evicted simply for complaining about the condition of a property
  • help to prevent people being made homeless when a joint tenant leaves a tenancy, thereby ending the tenancy for everyone else
  • do more to help victims of domestic abuse by enabling the person carrying out the abuse to be targeted for eviction
  • introduce a streamlined abandonment process so landlords can recover abandoned properties quicker.

Other regulations, such as mandatory electrical safety checks, are also likely to be made later in the year. A full briefing can be found here.

HMO Planning Permission

On February 25th new secondary legislation came into force that created a new use class (C4) for HMOs occupied by not more than six residents. This will mean that anyone wanting to create a new HMO for between three and six unrelated individuals in Wales will now have to apply for planning permission, paying the (recently increased) application fee with no guarantee of success.

The same policy was introduced in England just before the 2010 General Election. However, it was subsequently amended by the incoming Coalition Government who granted permitted development rights to changes from a dwelling house (C3) to HMO (C4), unless an Article 4 direction was in place.

It is possible that such a change could be brought in for Wales following the election in May, depending on the make-up of the Assembly.

So, what next?

OLYMPUS DIGITAL CAMERA
OLYMPUS DIGITAL CAMERA

On Thursday May 5th Welsh voters will be heading to the ballot box in the Welsh Assembly Elections.

Interestingly, neither the Labour, Conservative or UKIP manifestos spare any space for the PRS in Wales. The current Labour Government, having already introduced all the policies mentioned above, most likely see the job as having been completed for now.

Other parties, however, want to go even further. Rent controls are a theme running through the manifestos of the Liberal Democrats, Plaid Cymru and the Green Party.

On top of this, the Lib Dems want to set letting agent charges and introduce a HMO business rate. Plaid want to legislate further on enforcing higher standards for PRS properties, as well as set up a database of all complaints made about landlords. The Greens are promising a new “Right to Rent” law to “strengthen tenants’ rights”.

Ultimately, the nature of the PRS in Wales over the coming years will come down to how the Welsh people vote, and the make-up of the Government they return to the Senedd in less than two weeks’ time.

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