Regulation and Enforcement Wales

Wales fee ban a step closer

Victoria Barker
Written by Victoria Barker

The Welsh Government has introduced a Bill proposing a ban on fees charged to private rented sector tenants.

The Renting Homes (Fees etc) (Wales) Bill will ban fees charged for viewing a property, signing a contract, receiving an inventory or renewing a tenancy.

The Bill will only allow letting agents and landlords to only charge fees that relate to rent, security deposits, holding deposits or if a tenant breaches a contract.

It will also:

  • provide a regulation-making power to limit the level of security deposits
  • cap holding deposits to reserve a property before the signing of a rental contract to the equivalent of a week’s rent and create provisions to ensure their prompt repayment
  • create a robust enforcement regime for when offences occur.

Speaking about the introduced legislation, Rebecca Evans AM, the Housing and Regeneration minister for the Welsh Government, said: “Fees charged by letting agents often present a significant barrier to many tenants, especially those on lower incomes.

“The bill will mean that tenants no longer face significant upfront fees when they start renting. In most instances they will only need to pay their monthly rent and a security deposit.

“I want renting to be a positive and widely accessible choice for people, and this bill will ensure that rental costs become more reasonable, affordable and transparent.”

Penalties for non-compliance include a £500 fixed penalty.

The RLA was mentioned frequently in a statement by Rebecca Evans AM on The Renting Homes (Fees etc) (Wales) Bill, that took place on Tuesday, which you can read here.

Welsh tenants fee ban will punish the vulnerable

The RLA is warning that banning letting agents from charging tenants fees in Wales would only serve to make life more difficult for the most vulnerable.

RLA Director for Wales, Douglas Haig said that the agent fee ban in Wales would punish the vulnerable.

He 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.”

Ambiguous

The RLA also has concerns over the ambiguity surrounding ‘prescribed limits’ for security deposits, because there is no clarity in the proposed Bill as to what this ‘prescribed limit’ will be.

Mr Haig added: “We have concerns that with severe penalties in place for those charging prohibited payments that there is insufficient clarity regarding security deposits. 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.”

The Renting Homes Wales Act has already been passed by Ministers, and included within this are proposals to ban tenant fees. In July last year, a consultation on the proposals to ban letting agent fees in Wales was launched. A summary of the responses can be read online here.

Minister welcomes engagement with the RLA

During a statement by Rebecca Evans AM on Tuesday, the Minister welcomed the engagement that the Welsh Government had had from the RLA and other representative bodies in the process of preparing the Bill. She welcomed the constructive comments that were made and was sure that and the constructive comments made and was sure such engagement would continue.

In England, the ban is due to take effect next year, although the timing of this will depend on when Client Money Protection is made mandatory as the Government wants to implement this first.

Learn more:
  • The Rent Smart Wales licensing scheme, introduced two years ago, requires agents and landlords to undergo training and obtain a licence. The RLA run a Rent Smart Wales training course, which available as a classroom course and an E-learning course for agents and landlords.
  • Rebecca Evans AM was the keynote speaker at our Future Renting Wales conference last year. Watch an interview with the Welsh Housing Minister here.

  • The Rent Smart Wales licensing scheme, introduced two years ago, requires agents and landlords to undergo training and obtain a licence. The RLA run Rent Smart Wales training course, check out on taking place in Cardiff here. (link)
  • Rebecca Evans AM was the keynote speaker at our Future Renting Wales conference last year. Watch an interview with the Welsh Housing Minister here.

About the author

Victoria Barker

Victoria Barker

Victoria is the Communications Officer for the RLA.

With a degree in Journalism, she is responsible for producing articles for our Campaigns and News Centre, the weekly E-News newsletter and creating social media content.

Before joining the RLA, Victoria worked in the University of Salford’s press office, and during University she represented Smooth Radio at events across the North West, as a member of the street team.

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