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Renting in Wales: Concern over cost of tenancy changes Renting in Wales: Concern over cost of tenancy changes
(about 7 hours later)
Changes to how social and private homes are rented in Wales may cost £45m, says a landlords' organisation which claims it is better spent building houses. Plans to change how social and private homes are rented in Wales have been outlined by the Welsh government.
The Welsh housing minister is expected to announce plans to simplify tenancy agreements. Welsh Housing Minister Carl Sargeant said simpler tenancy agreements would make it easier for tenants and landlords to know their rights.
It is understood Carl Sargeant wants to make it easier for tenants and landlords to know their rights. But a landlords' organisation warned the changes would significantly increase the costs to its members.
But the Residential Landlords Association (RLA) said the changes will significantly increase their costs. The Residential Landlords Association (RLA) argued the extra money would be better spent on building homes.
Local authority-owned rented properties currently operate under secure tenancies, which allow tenants to live in their properties indefinitely. Local authority-owned rented properties currently operate under secure tenancies which allow tenants to live in their properties indefinitely.
Private rented and housing association tenants, however, are subject to assured shorthold tenancies.Private rented and housing association tenants, however, are subject to assured shorthold tenancies.
These give tenants the right to occupy a property for a fixed period of time, but at the end of this the landlord has the right to terminate the tenancy.These give tenants the right to occupy a property for a fixed period of time, but at the end of this the landlord has the right to terminate the tenancy.
It is understood that proposals being published by Mr Sargeant later on Monday will bring housing association properties in line with local authority-owned homes - meaning they will both operate under the secure tenancy regime. Under the proposals many different forms of rental contract would be replaced by just two.
The RLA said private rented homes would be on a yet to be defined "standard contract". It believes the reforms will cause a significant rise in legal and administrative costs for landlords. Housing Association properties would be brought into line with local authority-owned homes - meaning they would both operate under the secure tenancy regime.
Private rented homes would be on a "standard contract", similar to the assured shorthold tenancy.
The plans are based on recommendations made in April by the Law Commission, the statutory body which reviews the law.
Mr Sargeant said the new framework would provide a "fairer, more transparent and flexible system" that "has benefits for tenants and landlords alike".
"It will also help people in situations of domestic violence and in dealing with the anti-social behaviour of some households," he said.
"These proposals will create a level playing field for all landlords and also provide a fairer deal for tenants, irrespective of who they rent their home from."
But the RLA believes the reforms will cause a significant rise in legal and administrative costs for landlords.
"The laudable intention of the government's proposals, namely simplification, are ones which we wholeheartedly share," said Douglas Haig, RLA director for Wales."The laudable intention of the government's proposals, namely simplification, are ones which we wholeheartedly share," said Douglas Haig, RLA director for Wales.
"In our view, tenure reform can be achieved in a less radical way and without the huge upheaval and expense involved for landlords, tenants and others involved in all sectors of rented housing including the need to re-learn and re-skill across the board as a result of a completely new system.""In our view, tenure reform can be achieved in a less radical way and without the huge upheaval and expense involved for landlords, tenants and others involved in all sectors of rented housing including the need to re-learn and re-skill across the board as a result of a completely new system."
He added: "The millions that would be spent on the Welsh government's proposals are simply too high at a time when that money could be much better spent on building more homes."He added: "The millions that would be spent on the Welsh government's proposals are simply too high at a time when that money could be much better spent on building more homes."
Anti-social behaviour 'Hugely disproportionate'
In April, the Law Commission, the statutory body which reviews the law, recommended improvements to the legal framework governing rented housing in Wales. Shelter Cymru director John Puzey welcomed the proposals as "a really important step forward".
It suggested replacing many different forms of rental contract with just two types. "Some of the law associated with tenure dates back hundreds of years so the proposals to simplify contracts and establish two clear forms of tenure will benefit tenants in both the private and social sectors.
Under the proposals, Welsh ministers would ensure the use of contracts that would set out clearly the rights and responsibilities of landlords and tenants and the circumstances under which either party can bring the contract to an end. "Almost a third of our casework comes from people who live in the private rented sector.
The proposals would also help people faced with cases of domestic violence or housing-related anti-social behaviour. "This is a hugely disproportionate level of work given the size of the sector in Wales, but at base many of these problems are due to a lack of understanding about rights and duties by tenants and landlords alike," he added.
Following the commission's recommendations, Mr Sargeant said: "These proposals will provide a fair, simple and efficient legal basis for renting a home in Wales. A three-month consultation has now begun with a bill due to be introduced in the assembly in 2015.
"The Welsh government will take forward the recommendations with the aim of making the law easier for tenants and landlords to understand. Doing this will create a more effective rented housing system in Wales.
The Welsh government said Mr Sargeant will set out "ambitious legislative plans to improve arrangements for renting homes in Wales" with the launch of the Renting Homes White Paper consultation on Monday.