The end of 2017 saw some huge changes to the Scottish private rented sector, with a new type of tenancy introduced to make the process simpler, fairer and more transparent for landlords, letting agents and tenants alike.
2018, though, heralds a year of change for agents, with a big shake up of the whole industry.
Here, we take a closer look at the new system, what landlords need to know and how it could affect your letting agent.
A new Code of Practice for letting agents
From February 1 2018, letting agents in Scotland will have to abide by a new Code of Practice to ensure that standards are kept high across the board. It will outline the standards that all agents must meet, while also giving landlords and tenants the power to challenge those agents who aren’t offering the required levels of service.
Under-performing agents will have to up their game and any rogue operators will soon be weeded out, which will improve matters for all parties.
The main purpose of the new Code of Practice is to eradicate poor quality housing from the Scottish Private Rented Sector (PRS), in turn raising standards and building a more effective market that meets the demands of tenants, landlords and letting agents.
To ensure full compliance with the new code, all letting agents must also make sure they place client money in a dedicated client account, as well as belonging to a reputable Client Money Protection (CMP) scheme and holding professional indemnity insurance.
Letting agent registration
Another new piece of legislation coming into force this year is mandatory membership of a letting agents register. All letting agents and those working in property management will need to join the new register by September 2018.
Failure to sign up to the new register by the deadline will prove costly, with anyone carrying out letting agency work in Scotland who’s not on the register guilty of a criminal offence and fined accordingly. As well as fines of up to £50,000, those convicted could face up to six months in prison.
In order to be accepted on the register, letting agents will need to prove that they are ‘fit and proper’ to carry out their work, as well as meeting minimum training requirements.
Training requirements for letting agents
As stated above, to become a part of the letting agents register agents need to show that they meet minimum training requirements. In the registration process, agents need to supply evidence to show that everyone in their business who needs to has the relevant qualifications to carry out lettings work at Scottish Credit and Qualifications Framework (SCQF) level 6 or above.
While those who have attained level 6 or above in the last three years should comfortably meet the necessary requirements, people who were awarded their qualifications more than three years ago will need further training on letting agency work.
If someone doesn’t yet have the requisite qualifications but needs to be qualified as part of the registration process, there are three government-approved programmes that lead to these qualifications being gained: The LETWELL programme, Propertmark qualifications programme and, as long as certain conditions are met, the MRICS qualification.
Meanwhile, those who have a relevant qualification but received it more than three years ago will need to show that they have carried out 20 hours of letting agency training over the last three years, including at least 15 hours of formal training.
A new housing court
The Scottish government is also using 2018 to roll out the First-tier Tribunal for Scotland (Housing and Property Chamber) redress scheme. This means that if the new code of practice mentioned above is broken or breached, Scottish Ministers, landlords and tenants will have the power to take the issue to the First-tier Tribunal for Scotland (Housing and Property Chamber).
The Tribunal will, in turn, have the ability to issue an enforcement order, laying out the steps agents must take in order to fix the problem.
After the dramatic changes to the Scottish private rented sector in December 2017, the New Year has started with a bang in terms of new legislation for letting agents.
All of us operating in the PRS want an industry that is fair, transparent and working in the best interests of all parties. Scotland has long been a leader when it comes to new rental legislation and setting high standards, with other parts of the UK often following in our footsteps a few years down the line.
To find out more about what Letting Solutions, West Lothian’s first dedicated lettings agency, can offer you, please get in touch with us on 01506 425693.
We also provide instant online valuations to give you an idea of how much your rental property could be worth in the current marketplace.