The Rent Smart Wales scheme could be heading for chaos as figures suggest that significant numbers of letting agents and landlords are yet to sign up. This is despite the fact that they were given a year to do so.
Data provided to EYE from Cardiff Council, which is administering the scheme for the whole country, suggests there could be a mad rush with the deadline of November 23 nearing.
From then, all landlords must register, and all agents and self-managing landlords must obtain a licence, with the aim to ultimately eliminate rogue agents and landlords.
The latest figures, until the end of October, show that 38,782 landlords are registered and 10,386 are being assessed, while 3,073 have a licence and 3,986 are being assessed.
Rent Smart Wales has issued 303 licences for letting agents but a further 576 are in process.
The landlord numbers fall well short of the 130,000 estimated landlords in Wales, although a Cardiff Council spokesman said it was wrong to draw the conclusion from these numbers that there would be a shortfall.
It may well be the case that landlords are biding their time and applying late to ensure their licence lasts for as long as possible.
The Rent Smart Wales website says it is currently taking ten days to respond to emails and applications can take up to eight weeks to process.
The Residential Landlords Association is warning of chaos.
Douglas Haig, RLA director for Wales, said: “We warned that registration and licensing would be ineffective and a bureaucratic nightmare, but it is fast turning into a complete fiasco.
“During the consultation period we advised the Welsh Government that the deadlines were too tight, and that agents should have been licensed first, before rolling out the scheme to landlords.
“The communication programme for Rent Smart Wales has not been good enough. Not enough landlords even know that this is happening.
“The Government vastly underestimated the size of the challenge ahead and aren’t property equipped to deal with enquiries, let alone the enforcement of the legislation.
“A decision needs to be made now about the best way forward from here.
“If Rent Smart Wales is to extend the deadline then it must also extend the lifetime of the licence – so that those people who signed up ahead of the deadline don’t lose out.”
David Cox, managing director of ARLA, said it was concerning that many had not yet applied for licences.
He said: “If landlords and agents find themselves unlicensed when the deadline arrives on November 23, they will be unable to practise, so it’s important to act soon to ensure the necessary qualifications and other regulatory requirements have been undertaken before then, in order to comply with the legislation.”
To obtain a licence agents need to visit the Rent Smart Wales website and will also need to complete an approved training course.
A licence is only needed for the company but employees must be declared on the document.
The cost of the licence, which lasts for five years, depends on the number of properties let in Wales.
Fees start at £1,890 for those with up to 100 rented properties in Wales if the agent is a member of a professional body. Fees start at £2,100 for those that aren’t part of a membership organisation.
Failure to comply could result in rent-stopping orders, fines and the inability to serve Section 21 notices.