Houses in Cathays
Houses in Cathays

I am pleased to see that letting agency fees have finally been banned across Wales thanks to new legislation by the Welsh Government.

The law means it is now an offence to charge a tenant any payment that is not specified as a ‘permitted payment’. This means tenants cannot be charged for such things as an accompanied viewing, receiving an inventory, signing a contract, or renewing a tenancy. On average, tenants will be expected to save £200 during their tenancy. Please note that these changes only apply to assured shorthold tenancies.

Letting agents and landlords are now only permitted to require a payment for rent, security deposits, holding deposits, a payment in default (when a tenant breaches a contract), and payments related to council tax, utilities, a television licence, or communication services.

The law caps holding deposits paid to reserve a property before the signing of a rental contract to the equivalent of a week’s rent and creates provisions to ensure their prompt repayment. It also gives the Welsh Government the power to limit the level of security deposits should it need to in the future.

These new charges are backed up by a clear, simple and robust enforcement regime to deal with breaches. Fixed penalty notices of £1,000 may be issued against anyone seeking a prohibited payment. If penalties are not paid, alleged offences can be prosecuted. For serious offences, an enforcement authority could decide to proceed directly to prosecution.

Most offences carry a fine which is not subject to any statutory limit. Rent Smart Wales will be notified of any prosecution, which they can take into account when considering suitability to hold a licence – without which an agent or landlord cannot let or manage properties in Wales.

Students in particular have been repeatedly been walked over by these costs from letting agencies, and it will be good to see them properly supported. An end to a system of taking advantage of those often leaving home for the first time can only be a good thing.

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