The Welsh government has issued its guidance to letting agents and landlords ahead of the country’s fees ban due to go live on September 1st, highlighting the key differences between it and the existing English legislation.
As in England, the ban only applies to tenancies entered into after the legislation begins – September 1st – including service charges or fees that may need to be paid after the start date but set out in tenancy agreements signed beforehand.
The Renting Homes (Fees Etc.) (Wales) Act 2019 will also apply to tenancies that renew after September 1st.
But two key and major differences exist aside from minor non-administrative details, according to ARLA Propertymark. These are that in Wales there will be no limit on security deposits, and that the default fees clause is much wider than lost keys and chasing unpaid rent.
The new tenant fees ban legislation permits eight kinds of payment including rent, a a security or holding deposit, default payments (when tenants pay their rent late and have to be chased) and also payments for council tax, utilities, television licence and broadband/phone services.
Tenant fees ban
Agents are allowed to charge a tenant for the outstanding rent if they quit a tenancy early, something they can already do, but not to change a contract at the tenant’s request, for example to change tenant names for an ‘in common’ shared house contract.
All other fees will be banned in Wales including check-in fees, check-out (or ‘exit’) fees and well as administration, inventory and guarantor fees, aligning Wales with both England and Scotland.
The act will also ban agents from forcing tenants to take up utility or other ‘preferred services’ such as a deposit alternative as a condition of entering a tenancy.
It will also be illegal to ‘load’ fees into the rent during the early months of a tenancy.
“We have been expecting the release of the guidance and ARLA Propertymark will be reviewing it and producing a Tenant Fees Toolkit specific to Wales, with a broad range of resources which will be made available to members as soon as possible,” says David Cox, Chief Executive of ARLA (left).
Cox last week claimed that the fees ban in England has already lead to rent rises since its fees ban went live on June 1st.