Two shake-ups to the private rental sector in Wales
Two shake-ups to the private rental sector in Wales
If you’re a letting agent in Wales, keep on reading, because this week sees two big changes in the private rental sector.
New immediate obligation to display fees
The first big change is that letting agents need to be aware of a new – and perhaps unexpected – legal obligation as of Monday 23 November to display their fees. This obligation already existed in England, but there was limited warning of its official introduction to Wales, even though it’s been in the pipeline for some time. It appears that not even the Association of Residential Letting Agents (ARLA) was aware that these changes were taking place until only a few days ago.
The new obligation falls under the Consumer Rights Act 2015 and letting agents must from now on openly display a list of all their fees, as well as any additional fees, charges, or penalties that are in tenancy agreements or terms of business. Figures should include VAT and the rules apply both in offices and on websites.
If you were unaware of this early Christmas present and need help, the ARLA has created a fees template for its members. Tips from us are to make sure your display is easy to see or access, very clear, and not in any way misleading.
Rent Smart Wales scheme now live
The second big change is that the Rent Smart Wales scheme also went live on Monday. If you’re letting a property in Wales, you now need to register yourself and any rental properties you own. Not only that, but if you manage or perform maintenance on the property you must:
- apply for a licence to do so
- be considered a ‘fit and proper’ person
- undertake a training course
- follow a Code of Practice
These new obligations are mandatory and apply to both landlords and managing agents. If you’re a registered landlord without a licence, you must instruct a licensed agent to manage your rental properties. Fortunately, the pressure to comply isn’t as immediate as with the fees obligation; under the Rent Smart Wales scheme, agents will have 12 months to register and become licensed before enforcement starts on 23 November 2016.
The Welsh Government are expected to push awareness of the scheme and its imposing obligations and encourage compliance during this introductory year. Failure to do so could result in wide-scale compliance failures, and it’s yet to be seen how councils plan to deal with that. The National Landlords Association’s chief executive, Richard Lambert, has said:
“As the licensing authority, Cardiff city council must start working with other local authorities from the outset in order to fine and prosecute those who fail to comply within the year’s grace period. Without proper enforcement the scheme will do nothing to stop criminals in the sector but as yet we’ve seen no detail about how Cardiff plans to do this.
“Unless they’re quick off the mark, come next November, there’s a real danger that Rent Smart Wales will amount to little more than just a list of names and it will quickly lose the confidence of tenants who expect it to make a difference.”
Sim Sekhon of LegalforLandlords commented: “This scheme has been introduced to try and boost tenant confidence to rent. While these intentions are good, it’s awareness implementation that will make the difference. A recent survey showed that two thirds of tenants in Wales didn’t know anything about the scheme, and if they’re not even aware of it, how can it have any impact on their confidence to rent?”
