Welsh Government responds to default fees and holding deposits consultation
The Welsh Government has responded to the Renting Homes (Fees etc.) (Wales) Act 2019 consultation which looked at regulation relating to default fees and prescribed information for holding deposits in the private rented sector. The full consultation response can be found here.
The response confirms that the Welsh Government intends to bring forward regulations to:
- Further describe the default payments which will be considered as permitted payments under the Renting Homes (Fees etc.) (Wales) Act 2019. The intention is to provide clarity on what can be charged in respect of certain payments in default and the limits on any such charge. The Welsh Government intends to make these regulations early in the New Year.
- Prescribe through a clear list, the information a landlord or agent must provide to a tenant before a holding deposit can be taken. This will mean a tenant has the information necessary to make an informed choice before entering into a tenancy agreement and a landlord or agent will be able to make clear where they require action by the tenant. The Welsh government intends to make these regulations before the end of 2019.
The consultation outcomes confirmed that a majority of the responses were from individual landlords (77%) and agents (13%) whereas only three percent of the overall responses were from individual tenants.
The overall perspective from the landlord and agent bodies that responded was the need to ensure that charges could be levied when the tenant is at fault or there has been breach in the tenancy agreement. Further analysis provided confirms that a number of the respondents never had to charge default fees because of good relations with their tenants.
Based on the representative tenant bodies that responded, Diverse Cymru were alone in supporting the levying of fees for lost keys, late rent, bounced cheques and damages. Other organisations were more in favour of charges being restricted to only late rent and lost keys. However, there was no support for charges arising from the landlord’s time and administration costs.
What you can do
Landlords are encouraged to familiarise themselves with the Renting Homes (Fees etc.) (Wales) Act 2019 guidance to ensure compliance. We will provide a further update once the Welsh Government introduces the regulations.