Landlords and letting agents in Wales are also facing a ban on charging fees to tenants, under a new law that is currently in its first stage, much like that of the Tenant Fees Bill in England.
The Renting Homes (Fees Etc.) (Wales) Bill was introduced on 11th June this year. It shares a common goal with the Tenant Fees Bill to put an end to letting fees. Those who offend could end up with a £500 fixed penalty, unlimited fines, and face the possibility of losing their landlord licence.
Welsh Housing Minister Rebecca Evans has said that most tenants should only be asked to pay one month’s rent, as well as a security deposit. She commented: “Fees charged by letting agents often present a significant barrier to many tenants, especially those on lower incomes.”
The Residential Landlord Association (RLA), however, has warned that those on lower incomes are most likely to suffer as a result. Landlords may become reluctant to agree tenancies to those who they deem to be more of a risk.
Douglas Haig, RLA Director for Wales said: “Ultimately it will increase the pressure on the most vulnerable in Wales as they will no longer get the assistance from agents to obtain a tenancy.
“It will also shift costs onto long term tenants who have enjoyed incredibly low rent rises way below inflation for many years.
“We had hoped that the Welsh Government would look to work with the sector to create a solution that allowed it to continue to provide the improvements in service and quality that we have seen over the last decade instead of jumping on a Westminster Government policy.”
“We have concerns that with severe penalties in place for those charging prohibited payments that there is insufficient clarity regarding security deposits.
“There is no clarity in the proposed Bill as to what a ‘prescribed limit’ will be.
“The RLA believes that such an amount should be clarified within the Bill before enactment and not allowed to be determined by regulations brought in later.
“Further we are disappointed that the Welsh Government has not sought to take the opportunity to introduce provisions for passport deposits or to enable a portion of the deposit to be passported from the first tenancy to the next one.
“This would lessen the burden on tenants when the time comes to move to another rental home.”