Three Years On: Has the Renting Homes Act delivered?

This week marks three years since the Renting Homes (Wales) Act 2016 came into force on 1st December 2022,  aiming to improve tenant security, professionalise the sector, and raise housing standards.  The sweeping changes saw the replacement of section 21 with the six-month notice section 173 notice, changes to other possession grounds and tenancies changed to ‘occupation contracts’ which require prescribed clauses provided by Welsh government.

But are standards improving – and how is the sector adapting to the changes?

Rent Smart Wales (RSW), is the  organisation that oversees landlord registration and licensing in Wales under the Housing (Wales) Act, and a key body in the private rented sector in Wales.

A major evaluation of RSW published in May, as well as a similar evaluation of the Renting Homes Act itself, offers some answers.

There are fewer homes to rent in most areas of Wales

Before the Act came into force, the number of rental properties registered with Rent Smart Wales peaked at 217,631 in mid-2022. By the end of that year, the figure had dropped to 208,732 – suggesting nearly 9,000 properties have been lost from the sector.

Since then, registrations have recovered to 215,822 but growth has been confined to just three areas of Wales - Cardiff, Swansea and Blaenau Gwent.

The good news

Data from the Renting Homes (Wales) Act Evaluation shows that smoke alarms, carbon monoxide detectors, and electrical testing requirements are being met consistently across both social and private sectors.

Several tenants said the Act had been "a catalyst for prompt repairs," with landlords responding to maintenance issues and tenants feel better able to engage with their landlord.

Responsible landlords are going to great lengths to ensure full compliance, particularly around contract details, with many investing in legal advice to get things right

However, of the landlords and agents that responded  a massive 92% said there had been no positive impacts at all, with 3% of this same group saying the Act had a negative impact.

Why is the picture so bleak?

The evidence suggests that the transition process which saw frequent delays, last minute changes to legislation and an overall lack of time for landlords to prepare for the conversion process was extremely challenging for some.

The evaluation found a clear divide, with landlords who are members of organisations like the NRLA demonstrating significantly better awareness and compliance than those operating independently, with membership of professional bodies continuing to be the key differentiator in navigating the Act successfully. The NRLA was found by 97% of respondents to be “the most useful source of support and guidance on tenancies and contracts”.

Lessons for England?

The timing is significant. As England's Renters' Rights Act begins implementation, Wales offers a three-year case study in rental reform. The Welsh experience suggests that well-intentioned regulation doesn't automatically translate into better outcomes.

Administrative complexity can create distance between landlords and tenants rather than improve relationships. Sector contraction doesn't necessarily mean only "rogue" landlords leaving - often it's smaller, compliant portfolio holders who exit first.

Enforcement needs adequate resourcing to be effective, and without this extra resourcing regulation alone cannot drive up standards. This can leave landlords and agents feeling that they are on the sharp end of regulation for no benefit.

The Verdict

Three years on, the Renting Homes Act has achieved some of what it set out to do, but there are still issues. One of the aims of the Act was to simplify tenancy agreements and housing law in Wales, but it has achieved neither. Many stakeholder responses to the evaluation noted that the complexity and bureaucratic nature of the act is disproportionate to any limited benefits it may have brought.

With England now embarking on similar reforms, perhaps the most important lesson from Wales is this: regulation alone doesn't fix housing. Without adequate supply, proper enforcement resources, and clarity about roles and responsibilities, even the best-intentioned reforms risk unintended consequences