Update on the Renting Homes Bill
Simon White
Housing Policy Division
Welsh Government
rentinghomes@wales.gsi.gov.uk
www.wales.gov.uk/rentinghomes
Overview:
• The Welsh Government’s aim: ‘a flexible, efficient and
responsive housing system that helps people to meet their
housing needs’
• What I’m going to cover:
The current picture and problems
Calls for reform
Renting Homes White Paper
Responses to specific aspects of the proposals
Currently:
•
•
•
•
1 in 3 households rent; private renting increasing
Tenants are less happy than owner-occupiers
Two types of renting – long-term and short-term
Many different tenancy types causes problems:
×
×
×
×
×
×
Confusion surrounding licences and tenancies
Knowing what tenancy exists
Tenancy agreements difficult to understand
Lack of clarity leads to disputes
Absent joint tenants
Domestic abuse and relationship breakdown under joint
tenancies
× Renting by 16 and 17 year olds
Calls for reform:
• 1996 - Lord Chief Justice Woolf: “reform of the substantive
law on housing could do more than anything else to reduce
cost and delay .. the main source of difficulty is the complexity
of the substantive law itself.” Access to Justice
• 2000 - Nick Madge, Circuit Judge: “Housing law has become
an impenetrable forest. […] There are few paths through the
forest, known only to the most skilful lawyers. Some who
enter the forest escape with scratches and torn clothes. Many
become hopelessly lost.” The Times, 25/07/2000
• 2009 – Lord Justice Jackson “simplifying substantive housing
law would considerably reduce the costs of litigation in that
area and improve access to justice”. Review of Civil Litigation
Costs
Renting Homes White Paper:
•
•
•
•
•
•
Based on Law Commission’s 2006 ‘Renting Homes’ report
Single legal framework for social and private renting
Enables ‘single social tenancy’ for Wales
Clarity on rights and responsibilities through written contracts
Model contracts freely available to all
Secure Contract: high level of security protected by law;
replaces Secure and Assured Tenancies; can also be used
by private landlords.
• Standard Contract: low level of security under law; greater
security can be agreed through fixed terms; replaces
Assured Shorthold, Introductory and Demoted Tenancies;
provides greater flexibility for short-term renting
• A legal basis for supported housing
Overview of White Paper responses:
173 responses broken down as follows:
• Local Authorities
• Housing Associations
• Private landlords / Letting Agents
• Voluntary organisations
• Other organisations
• Tenants / Individuals
26
33
30
21
36
27
(15%)
(19%)
(17%)
(12%)
(21%)
(16%)
Overall level of agreement / disagreement
Yes
(%)
No
(%)
Number of
responses*
Do you support our proposals for changing the legal
framework for renting a home?
95
5
110
Do you agree that the secure contract should be
based on the current local authority secure tenancy?
90
10
81
Do you agree that the standard contract should be
based on the current assured shorthold tenancy?
91
9
100
a) Addressing the anti-social behaviour of some
households
95
5
96
b) Dealing with domestic abuse
90
10
97
c) A more flexible approach to joint tenancies
d) Abandonment of the property by a tenant
e) Renting by young people
f) Standardising succession rights
94
97
75
92
6
3
25
8
94
93
83
85
g) Standardising eviction for rent arrears
75
25
84
h) Requiring landlords to ensure there are no
Category 1 hazards under the Housing Health &
Safety Rating System
91
9
96
84
16
82
90
10
71
88
12
69
Question
Do you support the proposals in relation to each of the
following issues:
i) Abolishing the six-month moratorium on ‘no
fault’ evictions
j) Establishing a legal framework for supported
housing
k) Bringing housing association Rent Act
tenancies within the Renting Homes framework
General comments:
• ‘The current complexity of tenancy agreements and the
general confusion PRS tenants experience needs to be
simplified.’ Private rented sector tenant
• ‘The proposed simplification of contracts in relation to a
tenancy to bring clarity to the renting process for all is
welcomed.’ National Landlords Association
• ‘The introduction of a consistency of tenure is necessary to
grip the issue of housing and the many pitfalls associated
with rogue landlords and difficult tenants. The "Prohibited
Conduct" definition is particularly useful and police officers
will benefit from the standardisation in tenancy law in order to
resolve disputes.’ Dyfed Powys Police
Secure contract based on the current
local authority secure tenancy:
• 90% support for basing the secure contract on the local
authority secure tenancy
• Support for the principle of private landlords being able, but
not obliged, to use a secure contract
• Housing associations support the ability to vary contracts on
the same basis as currently applies to local authorities
Standard contract based on the
current assured shorthold tenancy:
• 91% support for basing the standard contract on the assured
shorthold tenancy
• “Having one standard agreement based on the current
shorthold tenancy will assist the Council in giving consistent
and correct advice and assistance to potential tenants.
Private landlords, particularly those with little experience of
the market, will benefit from having access to standardised
free agreements.’ Powys County Council
• PRS sector views differed regarding the requirement for a
written contract.
All-Wales ‘Prohibited Conduct’ term:
• 95% support for a statutory ‘prohibited conduct’ term
addressing housing-related anti-social behaviour were
strongly supported
• All-Wales Anti-Social Behaviour Group proposed
amendments to help ensure a more joined-up approach
between the police and landlords
• ‘A tightly structured discretionary route, ensuring
proportionality is addressed at an early stage, also appears
to be a positive approach to resolving anti-social behaviour
quickly and effectively.’ Merthyr Valley Homes
Dealing with domestic abuse:
• 90% support for the approach proposed
• ‘As a MARAC chair the proposals in respect of families
where there is a joint tenancy, which could lead to the
offending party only being evicted, is long overdue. This
issue has regularly been the topic of debate within the
MARACs I have chaired and has led to a great deal of
frustration by agencies working in the Domestic Abuse
arena.’ Dyfed Powys Police
• Suggestions were made for the definition of abuse to include
psychological, sexual, financial and emotional abuse.
More flexibility around joint tenancies:
• 94% support having a more flexible approach
• ‘We support the provisions to overcome the current
draconian position whereby notice from one joint tenant,
without knowledge or consent by the other, ends the joint
tenancy.’ Shelter Cymru
• ‘The paper presents a much clearer approach to joint
tenancies and reflects changing relationships in society,
allowing a tenant to be removed without having to start a new
tenancy.’ Cartrefi Conwy
• Concerns expressed regarding: addressing arrears;
continuity of SPOs; and landlord’s consent to add tenant
• Residential Landlords Association argued that, if principal
earner leaves, landlord should be entitled to possession on
expectation that the remaining tenant would be unable to pay
the rent
Renting by young people:
• 75% supported the proposal
• The proposal may help to address the fact that this age
group are particularly vulnerable in terms of a lack of
accommodation options, but that there would need to be
clear accompanying guidance - Children’s Commissioner for
Wales
• Some raised concerns regarding the appropriateness of 16
and 17 year olds renting
• Other concerns included: risk of statutory bodies avoiding
responsibilities; encouraging disownment; potential problems
in recovering debt from someone under the age of 18
Abandonment
• 97% welcomed the proposed clarification
• ‘The proposals on abandonment are very helpful. The ability
for landlords to recover possession of a property more
quickly, without the need to apply to court, will ensure that
rent losses can be minimized, and housing stock can be
used more effectively to the benefit of those in housing need.’
United Welsh Housing Association
• Need for clear guidance on the form of investigations to be
carried out to confirm abandonment
Standardising eviction for serious rent
arrears – abolishing ‘Ground 8’:
• Applies to secure contract only
• 75% in favour of standardisation
• Most housing associations favoured retention
• ‘While Ground 8 has only ever been used as a last resort,
more RSLs have said that they will look to use Ground 8 in
anticipation that tenants hit by the bedroom tax, who are
unwilling to move, are likely to very quickly accrue high levels
of arrears.’ Community Housing Cymru
• Council of Mortgage Lenders also wished to see Ground 8
retained for reasons of financial viability
• Structured discretion will apply – general circumstances and
those specific to the contract-holder, landlord and others
Requiring landlords to ensure there
are no HHSRS Category 1 hazards:
• 91% supported the proposal (including majority of private
landlords)
• ‘Category 1 hazards are those leading to death or chronic
illness and no reasonable landlord would contemplate
allowing such hazards on their premises.’ Private landlord
• However, concerns raised included: complexity of HHSRS
making it difficult to place a contractual obligation on the
landlord; actions of tenants can also cause a Category 1
hazard; private landlords not having the level of expertise
needed to assess hazards; and increased burden on local
authorities. Alternative approach proposed.
Removing the six-month moratorium
on ‘no fault’ possession orders:
• 84% in favour of abolishing the moratorium
• Comments in support included: the current law being
confusing; the moratorium having little practical effect
anyway; and that its removal would make it easier for high
risk groups to secure accommodation in the private sector
• Some respondents concerned about reducing security of
tenure
• Concerns also raised regarding increase in retaliatory
eviction – propose to address this
A legal basis for supported housing:
• 90% support for the proposals
• Broad recognition of the benefits of creating a legal
framework that recognises the needs of the sector
• Concerns relating to: entitlement to a supported standard
contract after four months; conversion to a secure contract
after two years; and longer period sought for ‘temporary
exclusion’ (though concerns also raised regarding possibility
of abuse)
• Continuing to engage with the sector to refine the proposals
• Any reduction in the rights of occupiers needs clear
justification
Thank you – any questions?
Simon White
Housing Policy Division
Welsh Government
rentinghomes@wales.gsi.gov.uk
www.wales.gov.uk/rentinghomes
Renting Homes
Illustrative Model Contract
What might the new contract look like?
Simon White
Housing Policy Division
Welsh Government
rentinghomes@wales.gsi.gov.uk
www.wales.gov.uk/rentinghomes
Two types of contract
• Secure Contract: high level of security protected by law;
replaces Secure and Assured Tenancies; can also be used
by private landlords.
• Standard Contract: the default for the private sector; a low
level of security under law; greater security can be agreed
through fixed terms; replaces Assured Shorthold, Introductory
and Demoted Tenancies; provides greater flexibility for shortterm renting.
• This overall structure will meet different needs - for example:
 standard – periodic or fixed term
 secure - community or private landlord
• Model contracts will be issued to assist landlords and provide
clarity.
Terms in the contract
• Key Matters – e.g. names of landlord and contract-holder;
address of premises; rent; rental period; deposit scheme;
landlord licence number.
• Fundamental terms – the essential rights and obligations,
including the prohibited conduct term. Most can be left out or
varied if this benefits the tenant.
• Supplementary terms - deal with other practical matters
which do not require the same degree of legislative backing.
• Additional terms - any other express terms, e.g. pets
Model Contracts
• Essential that landlords have easy access to contracts that
comply with the law.
• Welsh Government will produce model contracts for use by
landlords. These will include all relevant fundamental and
supplementary terms.
• A ‘Key Matters’ template for setting out details specific to the
let, e.g. landlord and tenant details, address and rent, plus
any additional terms.
• Landlords will be able to produce their own versions - but the
models will be freely available to download.
• So what might they look like…..
Key Matters Document
Model Contract Document
Model Contract Summary
Example of Easy Read Guide
Key Matters Document
+
Model Contract
=
‘The Contract’
Implementation
• Model contracts freely available in advance to help prepare
• All existing tenancies would automatically convert to the
appropriate new contract on a set date – arrears transfer too
• New contracts could then be issued at suitable point, e.g. in
private sector when one tenancy ends and another starts
• Continued engagement with stakeholders to minimise
administrative burden
• Guidance for landlords and tenants to assist in the change
• Long timescale to enable full stakeholder engagement
• Draft Bill considered by Assembly in 2015
• New scheme operational in 2017?
Thank you – any questions?
Simon White
Housing Policy Division
Welsh Government
rentinghomes@wales.gsi.gov.uk
www.wales.gov.uk/rentinghomes