Propertymark has called on the Welsh government to focus on boosting the supply of privately rented housing instead of enabling tenants who may be subject to a Section 173 possession notice eviction to keep the last two months’ rent as compensation, which the professional body referred to as ‘concerning’.
The news comes after the Welsh government clarified that it would support the option of allowing renters to retain the last two months of their rent as compensation when facing a Section 21 eviction in response to a recent inquiry into the private rented sector from the Senedd’s Local Government and Housing Committee, with Propertymark issuing both written and oral evidence as part of the process.
The professional body remains concerned about the committee’s advice to examine the feasibility of enabling tenants who are subject to eviction to keep the last two months’ rent as compensation. This is especially the case when the Renting Homes (Wales) Act 2016 already gives tenants with six months’ notice for evictions greater protection than tenants in England who receive a similar notice.
The Welsh government, however, embraced the recommendation to interact with stakeholders and report back with conclusions by the end of April 2025.
Propertymark wrote to Jayne Bryant MS, the cabinet secretary for Local Government and Housing, stating that they would be happy to be included in the Welsh government’s stakeholder engagement prior to April on this recommended measure.
The professional body states that introducing extra financial penalties for landlords is counterproductive when they are already experiencing excessive costs from tax hikes, climbing mortgage rates, and repair costs, as it risks hindering the supply of rental homes, and will, therefore, cause rents to increase.
Increasing supply is the most efficient method to stabilise rents and stop further market distortions. Other measures Propertymark encourages the Welsh government to pursue include constructing more social homes and reviewing the phasing out of tax relief on mortgage interest for landlords, and the extra Land Transaction Tax surcharge on buy-to-let property, which was increased across all bands in the December 2024 draft budget.
Building more social housing was recommended by the Senedd’s Local Government and Housing Committee, while the Welsh government stated that it will look at a register for accessible social housing properties.
By reviewing taxation, the Welsh government will be able to implement policies that cut costs for those intending to invest in the private rented sector, which will then increase supply and make renting more affordable for tenants.
Despite this, none of these measures were included in the Welsh government’s response to the committee’s report.
Regarding other recommendations that the Welsh government has accepted in principle, which includes the training and education for landlords and tenants on the grants and support available via the rapid response adaptations programme, Propertymark agrees with this recommendation.
However, the professional body expressed its disappointment that an opportunity to implement mandatory qualifications as opposed to a one-off course offered via Rent Smart Wales was not offered here.
Instead, Wales should be more aligned with Scotland that has mandatory qualifications for letting agents.
Finally, Propertymark stated that it is pleased the Welsh government has accepted the prospect of introducing a register of accessible accommodation available to rent. The professional body suggested this in both its oral and written evidence to the Senedd Local Government and Housing Committee’s Inquiry into the private rental sector as well as in the Levelling Up, Housing and Local Government Committee into their inquiry into disabled people in the housing sector.
However, they stressed that membership should be voluntary. Where appropriate social housing is not available, local councils should signpost people to suitable property in the private rental sector. This could be beneficial as it could cater for local support mechanisms for tenants.
Tim Thomas, policy officer at Propertymark, commented: “Propertymark has consistently supported both the Senedd Committee and the Welsh government in policy positions to improve the private rented sector in Wales. It is positive to see that Propertymark’s positions have been accepted by the Welsh government, including improved training which we have called for as part of our review of Rent Smart Wales, and improving access to the private rented sector through a local authority database of adaptive property in the private rented sector.
“The Welsh government has listened to our concerns over the unintended consequences of implementing rent controls in Wales by currently discounting them as part of their White Paper. However, they must now continue to listen to our advice over the likely impact of awarding two months’ compensation to tenants in receipt of a possession notice will have on the sector. We are continuing to engage with the Cabinet Secretary on this issue.”
Read the orginal article: https://propertyindustryeye.com/tenants-facing-eviction-to-keep-the-last-two-months-rent-as-compensation-in-concerning-move/
