Our roundup of news items over the past week. This week the Welsh Government announced the date the Renting Homes Bill will come into force, and we have news of a consultation on second homes and holiday rentals.
There is also the Court of Appeal hearing in the case of Northwood Solihull vs Fearns & Ors which is (or should be) worrying for agents.
Welsh reform act to go live on 15 July 2022
This week, the Welsh Government announced that the Renting Homes (Wales) Act will go live on the 15th July 2022, which will signal the start of the reforms. The Housing Minister for Wales, Julie James has described the bill as the biggest shift in Welsh Housing Law in decades.
The act will see a marked change for Wales, who up until this point had a very similar system to England, with some distinct differences. However, this act will bring in significant changes to the way landlords can evict tenants, issue tenancy contracts, and manage their properties with a notable change from current English Law.
However, some within the sector are calling for the Welsh Government to ensure the bill is fit for purpose before it comes into force. Chris Norris, the Director of Policy & Campaign’s of the NRLA argued that issues such, as the occupation contract terms, may need redrafting from the original consultation if the act is to be successful.
Court of Appeal to hear Northwood Solihull vs Fearns and Ors evictions case
An appeal on a significant case regarding evictions and how a rental deposit certificate must be signed will be heard at the Court of Appeal on 18th January 2022.
This case deals with eviction proceedings brought by Northwood, who served a section 8 notice on Fearns & other tenants who had stopped paying rent. The tenants, Mr Fearn and Ms Cooke argued during an initial court hearing that under section 44 of the Companies Act 2006 their eviction notice had not been properly signed under s44 of the Companies Act 2006, and that these requirements also applied to the confirmatory certificate for their original deposit.
If their argument is accepted, then the eviction notice would be invalid. In the High Court hearing in December 2019, it was held that while the Companies Act did not apply to eviction notices, they do apply to a confirmatory certificate for a rental deposit. This will be the subject of the Court of Appeal hearing.
This case could be very significant for agents serving section 21 notices. Without the proper service of deposit documents, a possession order notice cannot be served and more importantly, the tenant could make a claim against the landlord and also the agent, under the tenancy deposit rules. This could result in substantial claims being brought against agents, both by tenants and also potentially by their landlord clients for losses sustained by them resulting from the invalid paperwork.
As the law currently stands, protection can be obtained by using a clause drafted by solicitor David Smith JMW solicitors, which is available here. However, depending on the outcome of the case, this may no longer be necessary. We shall have to wait and see.
Government consult on Airbnb registration while Lib Dems call for tighter restrictions on holiday rentals
This week, the Government has announced it will be launching a consultation this year on the introduction on a tourist accommodation registration scheme.
Housing minister Christopher Pincher said:
We recognise that a large number of second homes and holiday lets can have adverse effects in some areas… We want to look at not just the issue of short-term holiday letting, but the effect that it has on supply
This was in response to Former Liberal Democrats’ leader Tim Farron who has called for sharper restrictions on holiday rentals. Most people agree that in some areas (including Mr Farron’s constituency) excessive second home-ownership and properties being used for holiday lets has caused a housing crisis. Farron has proposed a seven-point plan to curb the number of second homes. This includes giving local authorities the power to limit the number of rental properties in specified areas.
The CPRE has issued a statement saying that the government proposed tax changes do not go far enough, to protect local communities, particularly in rural areas.
Government set out a new plan to protect leaseholders from unsafe cladding
This week, the Government has announced a new approach to building safety to protect leaseholders and ensure that developers and companies pay to fix unsafe cladding in high rise buildings.
Michael Gove, Secretary of state for levelling up, issued an open letter to the housebuilding sector revealing that the old proposed loan scheme will be scrapped and replaced with a financial contributions scheme between the Government and developers within the industry.
Furthermore, a new dedicated team is being established to pursue and expose companies at fault and to force them to shoulder the burden of making buildings safe.
Gove revealed a four-point plan to help fix the current building safety crisis in his open letter here. The headline figure for the amount needed to remediate unsafe cladding on 11-18m buildings is estimated to be around £4 billion.
Tax Firm claims that landlords will have to foot the bill of energy efficiency improvements without the help of the Government
Tax advisory firm Blick Rothenburg claim landlords are in for a bleak future regarding assistance in affording energy efficiency improvements. Head of property Heather Powell has said:
“Government consultation documents offer no hint of grants or other funding for the significant works that many landlords will need to undertake to meet property standards being set by the government.”
Currently, the threshold stands at an EPC rating of level ‘E’. However, by 2025 the Government is planning on new tenancies to have a minimum EPC rating of band ‘C’ and this will apply to all tenancies by 2028.
Newsround will be back next week.