July 29, 2016
The Housing (Wales) Act 2014 introduced new legal obligations on landlords and letting agents of private residential property in Wales. As a result, a new licensing scheme know as Rent Smart Wales has been created within Cardiff Council to process landlord registrations and grant licences to landlords and agents who are required to comply with the new Act.
Any landlord who has a rental property in Wales which is rented on an assured, assured shorthold or regulated tenancy is required to register with Rent Smart Wales. A private landlord for the purpose of registration can include an individual, a joint landlord arrangement, a company, a charity or a trustee.
It should be noted that landlords must complete the registration themselves; an agent or another person who is not the landlord cannot do it on their behalf. If the property being registered is in joint ownership, one principal owner must register it on behalf of all other owners.
To comply with the new law, landlords will need to submit the relevant application and pay a fee to Rent Smart Wales. On the application, landlords must include the addresses of all their rental properties in Wales. Please note that properties owned outside of Wales do not need to be included. If applicable, a landlord must declare their agent on registration.
A landlord’s registration will last 5 years; after which time they must re-register.
Under the new law, landlords who undertake letting and management tasks at their rental properties in Wales are required to apply for a licence. However, if landlords in Wales use an agent to let and manage their rental properties, then they do not need a landlord licence.
For the purposes of the legislation, landlord letting and property management activities include tasks such as conducting viewings with prospective tenants, gathering character references, collecting rent and making arrangements for someone to carry out repair or maintenance.
A licence application must be submitted to Rent Smart Wales who will determine if a licence can be granted. A landlord will need to complete relevant training through Rent Smart Wales or with an authorised training provider.
For companies and larger landlords, their employees will also need to be trained and named within the landlord’s licence application.
An agent who undertakes letting and management work at rental properties in Wales on behalf of a landlord must be licensed. Collecting rent on its own requires an agent licence. There are a range of other activities which will require an agent licence and therefore a person or company who carries out work on behalf of a landlord should check the criteria for agent licensing.
As part of the agent licensing requirements the person applying for a licence, or the staff of the company applying for a licence, must complete approved agent training. Again, this can be completed through Rent Smart Wales or an approved course provider.
Landlords and agents have until 23 November 2016 to comply with the new legislation before the scheme will be fully in force. From this point, any landlords or agents found to be breaching their obligations could have action taken against them by local authorities and the licensing authority.
Although registration is a quick process, the licencing procedure can take up to 8 weeks to complete once all paperwork is submitted. It is therefore important that landlords and letting agents put in place arrangements to comply with the legislation in time.
If you would like any more information on this topic or a related topic, please contact our Commercial Property team.
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