Since I wrote my last post I have been working on the new Welsh ‘contracts’ and trying to get my head around them.
I have got, at the time of writing, up to the third main section (prohibited conduct) and already I have found many things which need to be added.
I would DEFINITELY not recommend anyone use these agreements without alteration.
For example, I have pencilled in amendments to
- Add the tenant’s (sorry, contract holder’s) email addresses
- Provide for agents details to be given
- Provide for third party deposit payers
- Provide for deposit replacement schemes
I’m also changing the way the document is numbered. Hopefully, that will come under s33 (editorial changes) and will not be deemed to be an alteration of a fundamental term – making landlords liable to refund up to two months worth of rent to their tenants!
But the thing which quite amused me, and prompted me to stop and write this post, was about deposits.
The Welsh Occupation Contract deficiency on deposits
The whole purpose of a deposit is so that the landlord can use it to reimburse himself for tenant / contract holder damage and loss. However, the model tenancy agreement has NOTHING in it about what the deposit should be used for.
All it does is set out that the landlord must use a proper scheme and comply with the various requirements.
However, one of those requirements, set out in the Renting Homes (Deposit Schemes) (Required Information) (Wales) Regulations 2022 at section 3(1)(g)(vi) is that the landlord must tell the contract holder
the circumstances when all or part of the deposit may be retained by the landlord, by reference to the terms of the occupation contract,
Which is going to be a bit difficult if you are using an unadulterated Model Contract – as it does not have any such terms!
It also means that there is probably not a lot of point in taking a deposit anyway (if you use an unadulterated model agreement) as if your agreement does not set out the circumstances under which you can make deductions – you will not be able to make deductions. Or you are (at best) at risk of not being able to make deductions. It will depend on what view the adjudicator takes of it, should your contact holder challenger your deductions.
One of my moles in Rent Smart Wales also tells me that they say they may be making amendments to the model agreements up to June! Which is great for all of us who have to prepare the new agreements ready for early July!
Heigh-ho!
If you want to get more of my tips and thoughts on the new Welsh laws: