12 month tenancies could become mandatory in Wales

Plans to extend the notice period for so-called ‘no fault’ evictions in Wales would give tenants 12-month contracts by default.

Minister for Housing and Local Government Julie James AM, has launched a consultation asking for views on proposals that include extending the minimum notice period applicable to a section 173 notice from two to six months. 

Section 173 of the Renting Homes (Wales) Act 2016, as currently drafted, allows a property owner to seek possession of a property without a breach of contract occurring with two months’ notice. However, the Minister believes there is more the Welsh Government can do about the use of no-fault evictions and has launched a consultation asking for views about amending the Renting Homes Act before it comes into force.

Under the consultation are main proposals for periodic contracts (those contracts with no end-date):

• Extending the minimum notice period applicable to a section 173 notice from two to six months;
• Restricting a landlord from serving a section 173 notice within the first six months of a periodic contract, rather than four months as currently provided for;
• Placing a six-month restriction on issuing a section 173 notice following the expiry of a previous notice.

The main proposals for fixed-term contracts (those contracts with a pre-agreed end-date) are:

• Removal of a landlord’s ability to end a fixed term standard contract under section 186;
• To consider the use of break clauses in fixed term contracts.

The Welsh Government are also seeking views about other proposals including:

• Restrictions on issuing possession notices to landlords which the courts have found to have carried out retaliatory eviction;
• Restrictions on issuing possession notices to property owners in breach of other laws related to rented housing, such as not having an Energy Performance Certificate or a valid gas safety certificate.

If implemented this could create a situation where a property cannot be repossessed within the first six months and then introducing a further six-month notice period could cause huge problems for landlords.

They will be left powerless when it comes to problem tenants, who will be legally allowed to stay in the property for a year. If tenants are not paying rent, huge arrears could build up in this time.