After it received approval from the National Assembly for Wales, Julie James, the Minister for Housing and Local Government has affirmed that the Renting Homes (Fees etc.) (Wales) Bill received Royal Assent.
This means that the legislation, which bans the majority of fees charged to tenants in Wales, has passed the third stage of legislative proceedings within the Welsh Assembly.
First introduced in June 2018 by the Welsh government, the Renting Homes (Fees etc.) (Wales) Bill makes it an offence to require tenants to make any payments which are not defined as a ‘permitted payment’. This includes fees associated with administration work in renewing or creating tenancy agreements, reference checks, conducting property viewings and check outs. It is estimated that the Act will save households approximately £200 for each tenancy.
Now, the private rental sector accounts for 13 per cent of all homes in Wales, and it is hoped that the legislation will bring clarity to the sector and improve the industry’s reputation as a whole, while giving confidence to tenants that they are receiving a fair deal.
Stage three of the legislative process allows members of the Assembly to table amendments, with these later being considered in the Plenary, or the debating chamber, by the entire Assembly. Should this stage pass, stage four then consists of a debate concerning the passing of the Bill, where it either will be passed, or fall if the motion is not agreed on. As the Bill has received Royal Assent, it will become an Act of the Assembly.
Amendments for the letting fees ban in Wales included prohibiting letting agents and landlords from charging fees when a tenancy ends. However, Ms James explained that there are circumstances where payments will still be permitted, such as if a tenant wishes to leave a property and fails to provide the required notice, or if a contract holder terminates a fixed term contract early.
The Welsh government also worked on an amendment alongside Plaid Cymru, which permits payments to be charged under utilities as part of a Green Deal.
The Bill also specifies that holding deposits which exceed the amount of a week’s worth of rent will be categorised as prohibited payments, and must therefore be refunded. A further amendment also specified that after a tenant has paid a holding deposit, that landlords and letting agents must not advertise the property to more possible contract holders.
Late rental payments will now be classed as payments in the event of default, with further default payments defined in the regulations. The legislation also details information about an enforcement authority, which will have powers to issue fixed penalty notices. Rent Smart Wales, the licensing authority, will have the power to enforce the Bill’s requirements, alongside local authorities.
This legislation comes amid more new regulation for the lettings sector, including the FFHH (Fitness for Human Habitation) Act.
The Bill will now move onto Stage Four of the legislative process where a final debate will take place and the Act will be passed into law. This is likely to take effect from the 1st September 2019, with a similar ban already in place in Scotland, and the Tenant Fees Bill taking effect in England from 1st June 2019.
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