The letting agent industry in Scotland has grown in recent years. It provides a range of property management services to private landlords. For example, finding tenants and managing the tenancy by collecting rent, arranging repairs and undertaking necessary checks such as for gas safety etc. Such services can help make sure a landlord meets their legal obligations and also supports good management and maintenance of privately rented properties.
Many letting agents in Scotland operate in a professional manner, complying with voluntary codes of practice and ensuring high-quality levels of service for the landlords and tenants they assist.
Such good practise is not shared by all and some landlords and tenants can be subject to poor standards of service and, in some cases, illegal practices by some letting agents.
In response to these issues, the Housing (Scotland) Act 2014 introduces a framework for the regulation of letting agents in Scotland. This includes:
- a mandatory register of letting agents with an associated ‘fit and proper’ person test and training requirement that must be met to be admitted to the register;
- a statutory code of practice all letting agents must follow;
- a new way for tenants and landlords to resolve complaints against letting agents for breaches of the statutory code of practice through a new specialist First-tier Tribunal; and
- powers for Scottish Ministers to obtain information and of inspection to support monitoring of compliance.
Once implemented, these measures will help increase the overall standards of service and professionalism within the letting industry and provide customers (tenants and landlords including former tenants and landlords) with an effective way to challenge bad practice.
The Scottish Government is currently working with key stakeholders to implement the regulatory framework. Work to date has focussed on the development of a draft statutory Letting Agent Code of Practice, which Scottish Ministers are required to lay before the Scottish Parliament by the end of January 2016.
We anticipate the code of practice and register coming into force alongside the First-Tier Tribunal being ready to accept letting agent cases, expected late 2017. We, therefore, do not anticipate the code of practice coming into force prior to January 2018.
In 2015 the Scottish Government consulted on a draft statutory code of practice and proposals for training requirements applicants to the register must have met to be admitted. The consultation document and published responses are available on the Scottish Government’s consultation website. Independent analysis of the responses has been undertaken by Research Scotland. The Scottish Government has used these responses to inform the draft Letting Agent Code of Practice.
In addition, a business and regulatory impact assessment (BRIA) has been undertaken on the introduction of a Letting Agent Code of Practice and an Equality Impact Assessment (EQIA) on the regulation of letting agents as a whole has been completed.