Fit For Human Habitation: Reforming Welsh housing law
An article explaining how the introduction of the ‘fitness for human habitation’ principle will affect tenants and landlords in Wales
[Extent: Wales only]
This article was originally published in the January 2018 issue of Adviser magazine and was correct at the date of publishing.
In 2016, the Welsh Government continued its reform of housing law in Wales when the Renting Homes (Wales) Act 2016 was given royal assent. The Act is designed to make it ‘simpler and easier to rent a home, replacing various and complex pieces of existing legislation with one clear legal framework’ (1).
A key part of this legislation is the introduction of the ‘fitness for human habitation’ (FFHH) principle. This principle is incorporated into the wholesale reform of tenancies in Wales. To understand how it will work, it is important to look at the reforms in general.
Occupation contracts
The crucial part of the Renting Homes (Wales) Act is the creation of occupation contracts to replace all current tenancies and licences with just two types of contract:
Secure contracts
– modelled on the current secure tenancy issued by local authorities.
Standard contracts
– modelled on the current assured shorthold tenancy used mainly in the private rented sector.
In an occupation contract the tenants will become contract holders. The main benefit of occupation contracts will be their simplified and less variable nature compared with current tenancies. Occupation contracts will be less variable through the introduction of fundamental terms, which are terms that must be in every contract in Wales. Part 2 of the Act establishes the concept of a ‘fundamental provision’; that is, a provision of the Act (generally a section) that is automatically included as a term of all occupation contracts, or of specified occupation contracts (and so forms part of the contract between a contract-holder and a landlord).
Current position on fitness for human habitation
At present in Wales and England there is an implied term for FFHH contained in s8, Landlord and Tenant Act 1985 (LTA 1985). However, this only applies to short-term tenancies of less than three years and, most importantly, where the property is let at a low annual rent (£80 in London and £52 elsewhere). The effect of the rent restrictions is that this provision is more or less redundant.
In determining whether or not a property is fit for human habitation under s8, LTA 1985, the court is to have regard to its condition in respect of nine matters set out in s10, LTA 1985, which include, among other matters, repair, stability, freedom from damp, ventilation and water supply. It will be unfit for human habitation ‘if, and only if, it is so far defective in one or more of those matters that it is not reasonably suitable for occupation in that condition’ (s10, LTA 1985).
In England, Karen Buck MP’s private member’s bill to amend s8, LTA 1985 so that the implied term for FFHH would apply to all residential lettings of less than seven years and to common parts without the current restrictions on rent is going through Parliament (a third attempt to make these changes in the past two years).
Fitness for human habitation regulations
Section 91, Renting Homes (Wales) Act 2016 will require landlords to ensure that a dwelling is fit for human habitation at the time of occupation and for the duration of the contract. The fitness requirement is a fundamental term that applies to all secure contracts and periodic standard contracts, and to all fixed-term standard contracts made for a term of less than seven years.
The Welsh Government is now consulting onFFHH regulations that will help to determine whether the property is FFHH. It has sought to balance the Regulations by proposing regulations that, in their opinion, ‘are not
prohibitively expensive for landlords to implement’ (2).
The draft FFHH regulations set prescribed matters and circumstances to which regard must be had when determining whether a property is FFHH, and a set of specific requirements on the landlord which, if not met, would result in the property not being FFHH.
Prescribed matters
The intention of the regulations is to set prescribed matters and circumstances that will have a similar application to the nine matters listed in LTA 1985. However, these have not been updated since they were first introduced in 1957. Instead, the Welsh Government has considered the more detailed approach set out within the Housing Health and Safety Rating System (HHSRS), which identifies 29 matters and circumstances that could give rise to potential hazards.
The regulations will work by providing the courts with 29 matters they must consider when making a determination, without any provision relating to the reasonableness of such as in s10, LTA 1985. The courts will consider the 29 matters listed as a whole and determine whether the property is fit for human habitation (see right).
The FFHH obligation under the Renting Homes Act will not require a detailed assessment to be carried out by a local authority. Instead, whether a dwelling is FFHH will ultimately be determined by the courts looking at these 29 matters in the round.
Specific requirements imposed on landlords
In addition to the regard that must be had to all the 29 matters and circumstances when determining whether the dwelling is FFHH, the regulations will also place specific requirements that will make a property automatically unfit regardless of the other 29 matters. Presently, it is proposed that there will be three requirements imposed on a landlord, which relate to: smoke alarms, carbon monoxide detectors and electrical safety testing at least every five years. Where these requirements are not complied with, a dwelling is to be treated as being unfit for human habitation.
What does FFHH mean for tenants?
This is the question on everyone’s lips. There are two mechanisms for tenants to use these regulations to their advantage: breach of contract and the landlord licensing scheme (Rent Smart Wales). In a breach of contract scenario, a tenant who believes their property is not FFHH can take a landlord to court to establish whether this is the case. Remedies will include specific action being ordered by the courts, or compensation.
Tied to this legislation is the relatively new compulsory licensing scheme in Wales, which requires all landlords who manage their own property to hold a licence with Rent Smart Wales. Licences are granted on condition with complying with the landlords and agents code of practice (3).
Compliance with these regulations is included in the code and therefore non-compliance could result in withdrawal of a landlord’s licence
Clarity and information
While we are at consultation stage it is hard to predict the issues that may arise in practice. However, Citizens Advice Cymru issued a report in January 2017 (4) making recommendations to the Welsh Government on how to proceed with fitness for human habitation issues.
In particular, Citizens Advice called for ‘clear accessible regulations and guidance which tenants and landlords can use to ensure properties are fit for human habitation’ and ‘clear standards about condensation, cold, damp, and mould’. Damp and mould are issues covered in the 29 matters that a court must have regard to in deciding whether a property is FFHH, and further non-statutory guidance in the draft regulations ‘provides examples’ of issues.
However, the guidance does not state the point at which those issues will render the property not FFHH (as there is provision for in s10, LTA 1985).
In the above-mentioned report, Citizens Advice also called for a ‘widespread information and education campaign to raise awareness and understanding of what private rental property conditions should be in Wales, and how to go about accessing improvements if they are not’.
What is clear from this system is that it will be tenant enforced, and for this to work, the Welsh Government and stakeholders will have to inform tenants of their rights and of the mechanisms to enforce these rights. In short, without information, tenants will not know what they are entitled to in housing standards, and cannot be expected to enforce rights they do not know about. Landlords also need to be aware, as failing to meet this standard could affect their business activity through court orders or their landlord licence.
This article was written by Calum Higgins in January 2018 as Welsh law expert in the Expert Advice Team at Citizens Advice.
Endnotes
- Welsh Government website: http://gov.wales/ topics/housing-and regeneration/legislation/rentingbill/?lang=en
2. Renting Homes (Wales) Act 2016 — Fitness for Human Habitation Consultation, October 2017
3. Available at www.rentsmartwales.gov.uk
4. Fit for human habitation? Private Rented Sector Tenants Qualitative Research, Citizens Advice Cymru, January 2017
