Residential letting and tourist accommodation: our policy ready-reckoner

Policy & Engagement Adviser, Emily Church provides us with this quick brief on current Welsh Government policy.
First published on 14 Aug 2023.
Housing Wales

Residential Letting

Fair Rents and Adequate Housing

  • We are gathering evidence to respond to the current Green Paper, the Call for Evidence on Securing a Path Towards Adequate Housing – Including Fair Rents and Affordability. The Consultation is open until 15 September. Although the Green Paper purports to be about housing adequacy across a range of areas, the focus is on the affordability aspect and on changes to the private rented sector.

  • A committee paper was presented to CLA Cymru’s Polisi Cymru committee, and the consultation response will be formulated from the meeting’s discussion. The Government is looking for comments on three rent cap models with the least-worst option being a market rent option (referred to in the Green Paper as Third Generation Rent Control)

CLA Welsh Housing Survey

  • The survey has reopened to gather vital data from our members who own private rented properties.

  • The data will be used within the Fair Rents & Adequate housing consultation response.

  • The data we collected last year proved a vital point that we continue to highlight that a large majority of CLA members provide properties at affordable rents.

EPC/MEES

  • The 2025 target for new tenancies to meet an EPC C will not be implemented until the EPC system has been reformed.

  • This is a CLA “lobbying win” following considerable effort. The UK Department for Levelling Up, Housing and Communities has announced an overhaul of energy efficiency targets for landlords. This is in the hope that pressure on the housing market might be eased.

Renting Homes (Wales) Act 2016

  • Any new residential tenancies granted will be what’s known as an Occupation Contract.

  • This brings in new notice periods, especially a 6 month notice for ‘No Fault grounds’, which cannot be presented within the first 6 months of a contract.

  • The new Act also brings in heightened responsibilities for the landlords to ensure the property meets the 29 matters and circumstances of the ‘Fit for Human Habitation’ Regulations (FFHH).

  • Our concern at present is the mass exodus from the private rented sector due to the continuous changes to the sector.

Tourism

Business Rates: increase to threshold days for holiday lets

  • Holiday let owners were impacted by an increase in the number of days a property needs to be occupied to be liable for business rates. This increase was from the previous 70 days to 182 days over a 12-month period.

  • If not met, the property would be liable to council tax as a second home and charged the second home premium where each Local Authority has the discretion to charge up to 300% second home premium.

  • We will continue to lobby WG of the unfairness of this policy, considering this is not a Wales wide issue and should be targeted at troubled ‘hotspot’ areas.

  • The only exemption to the second home premium is if a property has a planning restriction and can only be used for holiday purposes. The property will still be liable for council tax.

Visitor Levy (Tourism Tax)

  • The proposal was for holiday accommodation owners to collect the tax from overnight visitors to their properties and remit it to the tax authority.

  • The CLA strongly opposed these proposals recognising that it would impose additional administrative burden on holiday accommodation owners and deter potential visitors to Wales. Furthermore, overnight tourists are already contributing to the local economy, whereas day visitors contribute very little.

  • The WG has confirmed that they intend to introduce the levy before the end of this Senedd term, however, we are yet to receive any further details as to what level the levy will be charged and how the money collected will be spent.

Statutory licensing scheme

  • A proposal was announced by WG to introduce a Statutory Licensing Scheme for all holiday accommodation, which it feels will improve compliance with existing legal requirements and level the playing field for visitor accommodation providers.

  • The scheme may include holiday accommodation owners having to annually submit document evidence of essential standards being met such as Public Liability insurance, Food Safety certificates, Fire Safety certificates, among others. This may also include in-person checks from authoritative personnel.

  • The CLA agreed that a Comprehensive Registration Scheme would be more suitable than the intended licensing scheme.

  • We are awaiting a detailed response from WG on the actions going forward.

Key contact:

Emily Church
Emily Thomas Policy & Engagement Adviser, CLA Cymru.