Occupation Contracts - The New Tenancy Agreement for Wales
The new form of tenancy agreement under the Renting Homes (Wales) Act 2016 is called an occupation contract.
The Renting Homes (Wales) Act 2016, which was passed six years ago, will come into force on 15 July 2022. This act will change the current system for letting residential property in Wales.
The government has made it easier for landlords and tenants by having one law instead of many different ones. This makes it simpler for everyone. We will be looking at occupation contracts, which are the new form of tenancy agreement. These will replace most assured shorthold tenancy agreements and licences to occupy in Wales.
Fixed Term vs. Periodic Occupation Contracts
Standard occupation contracts can either be for a set amount of time, like 6 months or 1 year, or they can be periodic, which means week to week or month to month. If someone has a fixed term contract and they stay in the same place after the set amount of time is up, it becomes a periodic contract.
Standard vs. Secure Occupation Contracts
There are two types of occupation contracts: 1) Standard; and 2) Secure.
Since secure occupation contracts are for use by community landlords, we will be focusing on standardoccupation contracts for private landlords.
All occupation contracts must be in writing, and they must have specific terms. Within 14 days of when the contract-holder is supposed to start occupying the property, landlords need to give the contract-holder a written statement that has all of the details regarding the terms of occupation contract.
Written statements can be either printed out on paper or, if the person who has the contract agrees, sent electronically as an email or text.
Model Written Statements for Occupation Contracts
The Welsh Government has now published model written statements for both periodic and fixed-term standard occupation contracts. The model statements incorporate all the fundamental and supplementary provisions to be included (without modification).
If an existing tenant wants to convert their tenancy to a standard occupation contract, the existing terms of the tenancy will apply unless they conflict with the fundamental terms. Supplementary terms will be included unless they conflict with the terms of the existing tenancy.
What are the Terms in Occupation Contracts?
The key matters are things like the property information, when people can move in, and how much rent they will pay. The fundamental terms are the basic rights and obligations of landlords and contract-holders. The supplementary terms are practical matters to make the occupation contract work, like access for repair. The additional terms are other agreements not dealt with elsewhere, like keeping pets.
Succession in Occupation Contracts
If the only person holding a contract dies, the contract will end unless there is someone else who can take over the contract.
Joint Contract-Holders in Occupation Contracts
If the landlord agrees, other people can be added to the contract as joint contract-holders. A contract-holder can leave the contract without ending the tenancy agreement.
Termination in Occupation Contracts
If someone has a contract to live in a place, the person who owns the place cannot make them leave without permission from a court. If the person with the contract wants to leave, they must tell the owner six months before they want to leave. This way, the person with the contract always has a place to live for at least twelve months.
A landlord can still end the contract if the person who signed it is not following it. This usually happens when the person does not pay rent (if rent is paid monthly, at least two months’ rent unpaid), is being mean to others, or is not taking care of the property. A court must agree that it makes sense to evict the person before it happens.
If you want to move out of your house, you have to tell your landlord one month before you leave. But if you break the rules or don't pay your rent, the landlord can ask you to leave right away. If you owe a lot of rent, the landlord only has to give you two weeks notice.