I recently spoke to Sam Hawking (from Sam Hawking Property Lawyers) and Hannah McCartan (from The Landlord Community) about the changes to property law in Wales. Existing ‘Assured Shorthold Tenancy’ (AST) agreements have been replaced by ‘Standard Occupation Contract’ (SOC). There are also additional requirements regarding smoke and carbon monoxide detectors.
If you have any properties in Wales, or you are planning to buy any properties in Wales in the future, it is essential that you watch the full video (above) until the end. If you fail to comply with these new legal requirements, you could face hefty penalties. In this article, I will focus on the most imminent change, something all landlords in Wales need to get done this month!
1. You Must Do This By 1st of June
Now that all AST contracts have been converted into SOCs according to Welsh law, you must supply your tenants with a written statement explaining the new contract. This statement must convert the terms of the old contract into the new contract. This must be done a specific way, in accordance with the new law. The Welsh government has published guidance on how this must be done.
The written statement must be provided to tenants by the 1st of June. If you have a lot of tenants, each with slightly different AST contracts, this could be a time-consuming process. Typically, you will need to go through each contract and create individual written statements based on the terms of each. However, there is a solution to this, which I will come to later on.
2. This Could Cost You 2 Months' Rent!
The Welsh government is taking this requirement very seriously and there are penalties for not complying with the law. It is very important that you get this right. If you don’t provide a written statement, or the written statement is not complete, you could end up paying your tenant the equivalent of 2 months' rent in compensation!
For some landlords, 2 months' rent could be the equivalent to many months of profit! If you don’t want to lose that money, you should take the time to create these statements and ensure that they are done in a way that complies with the law. However, this does not necessarily have to mean a lot of extra work. There is a solution.
3. Universal Written Statement
Hannah McCartan from The Landlord Community has Universal Written Statement templates available. These statements can be used with very little modification for all AST contracts, regardless of the specific details of each. You can get the template contract and the training on how to use it from The Landlord Community for just £97.
Please note that I am not a lawyer and this information is for educational purposes only. Please seek independent advice on any action you take regarding compliance. That said, I hope you found this article helpful. If you know anyone with properties in Wales, please do pass this article on to them as well. The more we share, the more we can bring property education to the masses.