Rent Smart Wales will enforce a forthcoming ban on letting fees

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Yesterday, the Rental Fees Bill returned to the Senedd for AMs to discuss amendments in detail. The final version of the Bill – which will outlaw several kinds of rental fees in Wales – is due to be voted on next week.

At a Glance Guide

Renting Fees Bill as introduced (summary)
Stage 1 report (summary)

The Bill:

  • Bans up-front letting fees for new tenancies, renewing a tenancy or continuing a tenancy.
  • Any landlord/letting agency found to be charging a banned fee could be fined.
  • Gives the Welsh Government the power to regulate security deposits, while holding deposits will be capped at one week’s rent.
  • Places a duty on landlords/letting agents to fully explain fees to tenants and prospective tenants.

Major Changes at Stage 2

There’s a thorough summary of the changes from the Senedd Research Service (pdf).

Stage 2 proceedings were undertaken by the Communities Committee, while the member in charge at the time is the (now) Finance Minister, Rebecca Evans (Lab, Gower).

  • The fixed penalty/on the spot fine for charging a banned fee has risen from £500 to £1,000.
  • Landlords can’t evict a tenant on “no-fault” grounds if they haven’t complied with the new law.
  • The Welsh Government can set a cap on security deposits.
  • Landlords can explicitly require tenants to make their own arrangements for council tax, TV licensing and utilities.

The Key Amendments at Stage 3

Amendment 20 – Housing & Local Government Minister, Julie James AM (Lab, Swansea West)
Makes Rent Smart Wales the enforcement authority (Communities Committee recommendation).
Vote: Agreed unanimously.

Amendment 34 – Julie James AM
Effectively sets a cap – through regulations – on tenancy default fees.
Vote: Approved – 38 for, 9 against, 1 abstention

Amendment 43 – David Melding AM (Con, South Wales Central)
Increases the fixed penalty from £1,000 to £2,000.
Vote: Rejected – 20 for, 28 against
Reason for Rejection: The Minister believes a £1,000 fine is proportionate and reasonable, while the fine has already been raised from £500 at Stage 2.

Amendment 56 – Leanne Wood AM (Plaid, Rhondda)
Gives courts the power to revoke a landlord’s licence (under the Housing Act 2014) if they’re found guilty of charging a banned rental fee.
Vote: Rejected – 11 for, 37 against
Reason for Rejection: It “inappropriately restricts” the functions of Rent Smart Wales, who should decide for themselves who keeps a licence or not. An identical amendment for letting agencies was also rejected.

Amendment 65 – Leanne Wood AM
Landlords/agents must repay a holding deposit if a prospective tenant tells the landlord/agent within 48 hours of agreeing to a contract that they’ve changed their mind.
Vote: Rejected – 9 for, 39 against
Reason for Rejection: It would create a loophole where people put down holding deposits on several properties knowing they’ll get their money back, blocking other interested parties from agreeing to a contract on a property.

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