Landlords – Are you aware of Welsh Water payment changes?

Since the end of October 2024 the Welsh Government introduced a significant change for landlords who have their water and sewerage supplied by Welsh Water.

The new policy requires all landlords to pay for any charges that occur whilst the property is empty, whether a contract holder has moved out, or the landlord has only just purchased the property and has it on the market.

What is changing

Some properties may be in an area where a new scheme is being trailed called benefit of supply. This means if a property is unoccupied the landlord or owner will be responsible for the charges in-between contract holders now.

Previously in Wales landlords could avoid paying for water and sewerage charges in void periods providing they were unfurnished with no renovation work taking place.

Landlords or Lettings Agents are now required to inform Welsh Water within 21 days of any changes to the occupation. This needs to inform them of the following:

• The property Address
• Date of occupation / Date of vacation
• The title, name and date of birth for all adult contract holders

Why the change?

The primary reason behind the shift is to address the way water and sewerage services are billed. Like many other utility companies, just because a property becomes vacant does not mean that the operational costs stop. These costs include maintaining the infrastructure, treating the water, as well as any use from the landlord in these void periods, watering the garden, flushing the toilet etc.

The new legislation also takes away confusion as to who is responsible during the void periods, as often Welsh Water is not informed leading to unnecessary charges to previous contract holders. In 2017 Welsh Water estimated that in 15% of non-payment cases customers are no longer living at the property but remain registered for charges.

How will this effect landlords

• Increase Costs During Void Periods: For properties that are frequently vacant or have long periods where it is unoccupied, the landlord will have to factor in their additional overheads
• Responsibility for Setting up Accounts: Landlords (or Letting Agents) will need to make sure that the water accounts are set up within the 21 days or either a contract holder moving in or out of a property. If a new contract holder moves in and Welsh Water is not informed, the landlord can become jointly and severally liable for the water and sewerage charges.
• Potential for Higher Rent: In response to the increase of overheads landlords may potentially increase their rents in an effort to cover the costs that will occur when the contract holder moves out.
• More Efficient Management: Putting more financial responsibility on the landlords will encourage them to inform the water company of any changes to the property, reducing the non-payment cases.

What should landlords do

• Review Existing Contracts: If any of their contracts stated that the contract holder was liable for bills in the void period this would need to be amended
• Stay Informed: The Welsh Government and Welsh Water is likely to provide additional guidance on how landlords can manage this change, keeping up to date will help avoid any confusion.
• Monitor Void Periods: Getting the property marketed as soon as possible and minimising any void periods will be a huge help. As well as implementing water saving methods, for example, in some cases (but not all) if the property is not on a water meter it may be worth speaking to Welsh Water and changing to a metered billing.
• Plan for Higher Costs: Adjusting budgets to account for the increase costs and planning these charges in when working out the rental pricing.

If you have a property to Let, please do contact your local agent covering South Wales and surrounding arears on 01656657033 or email lettings@smart-lettings.co.uk