Landlord News

Mandatory 12-Month Contracts Planned for Rented Homes in Wales

Em Morley - July 9, 2019

New plans are being discussed to extend the notice period for so-called ‘no fault’ evictions in Wales. By default, this would give tenants mandatory 12-month contracts.

The Residential Landlords Association (RLA) says it is scandalous that the Government is considering such plans without first organising a reform of possession routes for the vast majority of landlords who have legitimate reasons to repossess their property.

Wales has an equivalent version of England’s Section 21, known as Section 173, as part of the Renting Homes (Wales) Act 2016. Under Section 173, private landlords cannot repossess properties within the first six months of the tenancy.

However, Welsh housing minister Julie James AM has now announced plans to extend the subsequent notice period from two months to six, resulting in landlords having to wait at least a year in total before being able to repossess.

One option to provide extra security as a landlord is to take out Rent Guarantee Insurance, as a backup, in case such issues do arise and risk leaving you out of pocket.

RLA Vice Chair and director for Wales, Douglas Haig, has commented on this news: “This is a scandalous move that is essentially introducing 12-month contracts by default.

“Creating a situation where a property cannot be repossessed within the first six months and then introducing a further six-month notice period could cause huge problems for landlords.

“They will be left powerless when it comes to problem tenants, who will be legally allowed to stay in the property for a year. If tenants are not paying rent, huge arrears could build up in this time.

“We will be warning government that this move could cause serious damage to landlord confidence and the availability of homes to rent in Wales, at a time when demand continues to increase.

“The government needs to ensure that landlords with a genuine need to regain possession of their properties are able to do so.”

It is now up to the Welsh government to discuss its options and decide whether to increase the minimum notice period for Section 173 from two months to six months, as well as restricting the issuing of a Section 173 for six months after the start of the contract.