Introduction

As a result of the Housing (Wales) Act 2014, landlords with rental properties in Wales have been required to be registered with the Welsh licensing authority, Rent Smart Wales (RSW). Landlords who undertake any management duties for any of those properties must also be licensed with RSW, as must all letting agents.

RSW came into existence on 23 November 2015. Since 23 November 2016, enforcement of RSW requirements has been in operation. It is a criminal offence not to comply with RSW requirements and will severely impact your traditional rights as a landlord such as your ability to take possession of your property.

For private rented landlords in Wales, each property must be registered with Rent Smart Wales if it is let out, or marketed for let, on a 'domestic tenancy'.

Domestic tenancies are:

• Occupation contracts (including any tenancies that converted over from assured shorthold tenancies in 2022); and
• Regulated tenancies.

The requirement does not apply to tenancies that are not occupation contracts, so if you are providing holidays lets, commercial leases, agricultural agreements, or it your own home and you take in lodgers, then you are not required to register with Rent Smart Wales. 

Who needs to register?

The landlord must register and provide their information themselves. They cannot have an agent register the property for them. 

How long does registration last?

Each registration lasts for 5 years. After this you will need to renew the registration if it is still let out or being marketed for let on a domestic tenancy.

How do I register?

Landlords can register on the Rent Smart Wales site after creating an account. 

How much does it cost?

If you apply online via the RSW site then a new registration will cost £60. Renewals of existing registrations cost £48. There is a more expensive paper based application available as well but we do not recommend it.

Are there any times a landlord is not required to register a property if it is let on a 'domestic tenancy'?

If you take ownership of a property, you are not required to register in the first 28 days after taking ownership.

This 28 day exemption can be extended further if you begin eviction proceedings during that period and diligently continue the eviction proceedings. In these cases, the exemption from registration will continue until the tenancy is ended.

I have recently purchased a property from another landlord but their registration is still active. What do I do?

In these cases, within 28 days of taking ownership you should contact Rent Smart Wales here and provide evidence you now own the property so that the registration can be transferred.

Typically, this evidence would be a land registry document, title deed of your completion letter from your solicitor.

I have sold the property midway through the registration period. Am I entitled to a refund?

No, Rent Smart Wales will only refund the registration fee where:

• One of the joint landlord has died and the property needs to be re-registered by the remaining landlords. In these cases a partial refund will be issued for the period between death and re-registration. 
• The original attempt at registration was incorrect or invalid. This refund will only be issued once the property is successfully registered.

Please note that where you have sold the property you are expected to contact Rent Smart Wales and confirm the property is no longer required to be registered. 

Who needs to apply for a licence

A landlord will not always need to apply for a licence in addition to registering the property. They will only be required to have a licence if they perform activities that would qualify as 'lettings or property management activities'. 

If they don't meet this requirement, then they must have a licensed agent perform the work for them instead.

What is letting or property management activities?

The definition of performing letting or property management activity changes depending on whether the work is done by a landlord or a letting agent. 

If you are a landlord this means you will require a licence if you perform any of the following activities:

• arranging or conducting viewings with prospective tenants;
• gathering evidence for the purpose of establishing the suitability of prospective tenants (for example, by confirming character references, undertaking credit checks or interviewing a prospective tenant);
• preparing, or arranging the preparation, of a tenancy agreement;
• preparing, or arranging the preparation, of an inventory for the dwelling or schedule of condition for the dwelling.
• collecting rent;
• being the principal point of contact for the tenant in relation to matters arising under the tenancy;
• making arrangements with a person to carry out repairs or maintenance;
• making arrangements with a tenant or occupier of the dwelling to secure access to the dwelling for any purpose;
• checking the contents or condition of the dwelling, or arranging for them to be checked as part of a current tenancy or for one which has ended;
• serving notice to terminate a tenancy. 

If the only activity you undertake is performing repairs at a property, or instructing a qualified solicitor to either draft a tenancy agreement or handle an eviction, you are not required to obtain a landlord licence.

If you are an agent this means you will require a licence, when acting on behalf of the landlord of the dwelling, by either collecting rent or undertaking more than one of the activities listed below.

• publishing advertisements or disseminating information;
• providing a means for prospective landlords (or their agents) and tenants to contact each other and communicate
• arranging and conducting viewings with prospective tenants;
• preparing, or arranging the preparation of, the tenancy agreement;
• preparing, or arranging the preparation of, any inventory or schedule of condition;
• collecting rent 
• being the principal point of contact for the tenant in relation to matters arising under the tenancy;
• making arrangements with a person to carry out repairs or maintenance*;
• making arrangements with a tenant or occupier of the dwelling to secure access to the dwelling for any purpose;
• checking the contents or condition of the dwelling, or arranging for them to be checked as part of a current tenancy or for one that has ended;
• serving notice to terminate a tenancy.

When is someone exempt from the licensing requirement?

A landlord is not committing an offence by not holding a licence if:

• They have applied for a licence and that application is still outstanding.
• They only acquired the property in the last 28 days. This is to give the landlord time to apply for a licence.
• They take steps to recover possession on the property within 28 days from the date the landlord acquires the property so long as the landlord is pursuing recovery of possession diligently. 

Additionally, Welsh Ministers have power to prescribe additional exemptions.

Agents are not committing an offence if they don't hold a licence where they are:

• publishing advertisements/disseminating information or providing the means (such as a platform) for landlords/agents to make direct contact with the tenant in response to advertisements or information which is disseminated so long as no other kind of lettings work is performed and the person concerned carries out no property management work in respect of the property
• arranging or conducting viewings for prospective tenants so long as the person concerned does nothing else in connection with the letting and is not undertaking property management work in connection with the property
• preparing and arranging for the preparation of a tenancy agreement, again so long as no other lettings work is undertaken and the property is not managed
• preparing or arranging for the preparation of an inventory/schedule of condition, again so long as nothing else is done in connection with lettings or in relation to the management of the property. This will exclude an inventory clerk from the need for a licence but only if they simply undertake the check in inventory (the check out is management work)
• anything done by an employee of the landlord (or an apprentice working for the landlord)
• anything done by an employee (or apprentice) of a licensed agent
• anything done by a contractor appointed by a licensed agent. This, for example, would cover a self employed contractor such as a workman working on behalf of an agent. NB: There is no similar exclusion for contractors working on behalf of a landlord, whether licensed or not. If that contractor is engaged in lettings work then he/she must be licensed.

Should both joint landlords apply for a licence?

If both joint landlords engage in property management work then both should hold a licence. If only one landlord is responsible for the property letting and management activity then only that landlord requires a licence. 

Who should apply for a licence for a property owned by a limited company?

The company must be licensed as an agent if it engages in property management activities. Employees are not required to have their own individual licences though, as the employer's licence would cover the employee. The employee is not exempt from the training requirement however.

Directors and secretaries of limited companies that undertake lettings and/or property management activities but who are not employees of the limited company are caught by the agent licensing provisions of the Housing Wales Act 2014, and must obtain an agent licence.

Once you have established you need a Rent Smart Wales licence you will need to apply to Rent Smart Wales. The application will require you to:

• Agree to abide by the conditions of the licence,
• Provide a 'fit and proper person' declaration,
• Undertake appropriate training
• Complete and pay the appropriate fee. 

Provided you satisfy all of these requirements then you must be issued a licence. 

How do I apply for a licence?

You can apply for your licence from your Rent Smart Wales account that you created for registering your property. 

How long will a RSW licence last for?

Your Rent Smart Wales licence will last for 5 years. You mya then apply to renew it in the 84 days before the licence expires.

Completing the required training for a RSW licence

All licence applicants will have to undergo training in order to receive a licence. Landlord training is offered by Rent Smart Wales or through approved training providers which include the NRLA.

In cases where a professional agent is also a landlord managing their own personal property and applies for a landlord licence, undertaking agent training will also fulfill the requirement for a landlord licence.

Letting agencies or other companies applying for a licence must ensure that their employees who perform lettings and/or management work undertake training in order for the company to receive its licence. This is a licence condition for all letting agencies. New staff have 12 weeks from the first day of employment to undertake training.

Failure to comply with these rules is serious and can lead to fines or make it difficult for you to regain possession of your property when needed. You should ensure you comply at all times with the RSW requirements in Wales. 

Revocation of licences

RSW has power to revoke a licence if:

• The licence holder has breached a condition of his/her licence.
• RSW no longer considers that the licence holder is a "fit and proper person."
• The licence holder has failed to update information.
• The licence holder and RSW agree that the licence should be revoked, e.g. because someone is no longer managing properties.

Prior notification must be given and the opportunity to make representations, unless the licence holder consents or RSW consider that exceptional circumstances exist and it needs to be revoked without delay. On revocation a licence holder must be told that the revocation has been made. Revocation does not take effect pending any appeal.

Where an agent's licence is revoked the landlord must be told as must any tenants of a property registered in the landlord's name. Where an agent's licence is revoked this puts the landlord in difficulties because he is potentially instructing an unlicensed agent or may have to carry on management without himself/herself having a licence. The landlord in this situation will have to immediately instruct a licensed agent or apply for a licence himself/herself.

Penalties for Licensing and Registration Offences

RSW have powers to issue fixed penalty notices and even undertake criminal proceedings against landlords who are in breach of the regulations.

Those who are not compliant with RentSmart Wales could face:

• Fixed Penalty Notices (of either £150/£250)
• Rent Repayment Orders
• Rent Stopping Orders
• Criminal Prosecutions and Fines

In addition, landlords are not able to serve valid notices to seek possession of their property unless the property is registered and either the landlord is licensed or the landlord uses a licensed agent to let and manage the property.

You may wish to view RentSmart Wales' guidance here.

Licensing appeals

An applicant/licence holder can appeal licensing decisions to the First Tier (Residential Property Tribunal). This includes: refusal of a licence, a licence condition (other than to comply with the Code of Practice), amendments to a licence, or revocation of a licence.

An appeal must be made within 28 days of the date of notification of the decision which is being appealed. There is power for the Tribunal to extend this period for good reason.

What happens when the landlord appoints an unlicensed agent?

Where a property is marketed, offered for let or actually let, the landlord must not appoint or allow an unlicensed agent to undertake lettings work or management work on their behalf

It is a criminal offence if they do so and they know (or should know) that the agent does not hold a licence.

Landlords will have to check to make sure that any agent they appoint is properly licensed. Appointing an unlicensed agent to undertake property management work can trigger a rent stopping order or a rent repayment order as well.

An unlicensed agent also cannot serve a valid Section 173 notice (Form RHW16) to terminate a contract.