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Shelter demands regulation of all Scots letting agents

Shelter demands regulation of all Scots letting agents

Shelter is calling for all letting agents in Scotland to be regulated.

It has used the words ‘Wild West’ to describe the industry – a phrase originally coined by the RICS.

Shelter Scotland is now urging the Scottish Government to introduce regulation, in a move that will be watched south of the border, and which has had a mixed reception in Scotland itself.

Although Westminster has declined to regulate letting agents, it will be making membership of a redress scheme mandatory. Furthermore, the CLG inquiry into the private rented sector, which will include a focus on letting agent fees and regulation, is still ongoing.

The Scottish Government is due to report on its own strategy for the private rented sector, decided as the result of consultation, at the end of this month on May 31.

Shelter last year has made much of the running in Scotland. Last year, it won a battle to tighten up the law banning letting agents in Scotland from charging any fees to tenants, and has also had a campaign to help tenants reclaim fees.

The organisation is showing no signs of letting up on its efforts – while some agents in the Scottish lettings industry itself claim it has not been helped by a lack of a representative body to fight their corner.

One Scottish agent said the industry has been “asleep at the wheel”.

Another, CKD Galbraith, which has six offices and is a member of RICS, ARLA, NALS and SAFEagent, said it openly welcomed the prospect of regulation. Partner and head of lettings Bob Cherry said it was “imperative” that all agents were accredited to prevent unscrupulous practices.

Shelter Scotland director Graeme Brown hit out at “cowboy letting agents” who he claimed were causing “havoc and upheaval to despairing tenants”.

He said: “Private renting in Scotland is growing and changing, driven by the fast-increasing number of families and individuals looking for a safe, secure and affordable place to call home.

“Despite this, letting agents have been allowed to carry on in an unregulated sector reminiscent of the Wild West, with the flagrant disregard for the law by some causing havoc and upheaval to despairing tenants.

“We’re particularly concerned by the growing number of families with children exposed to unscrupulous and sometimes illegal practices of some letting agents.

“Not only do they lose out financially, but the upheaval and uncertainty of battling cowboy letting agents can mean they’re prevented from laying down roots in communities and schools and getting on with their lives.”

There are 155 letting agents in Scotland who are ARLA members out of an estimated total of 500.

Shelter Scotland said in a report: “An ideal scheme would require letting agents to register and adhere to a code of conduct which promotes fair and honest practice to tenants and landlords. There then needs to be a formal way for complaints to be dealt with.

“Ultimately there needs to be a way of penalising those letting agents who fail to adhere to the code of conduct.”

The Scottish Government said it is committed to improving the lettings agent sector.

A spokesman said: “That is why we clarified the law last year to make it clear that the charging of premium payments for entering into a private rented tenancy was not allowed, and also introduced the Tenancy Deposit Scheme to safeguard tenants deposit money.

“Further regulation of the letting agent industry received broad support, including from the industry itself, as part of a recent consultation on a new strategy for the private rented sector.

“The Scottish Government’s strategy is due to be launched on May 30, and will set out our plans in this area.”

Mike Campbell, a Belvoir franchise owner in Falkirk, said:  “Good regulation separates rogue agents from the herd, recognises the difference, and forces them out. And the remaining good ones are encouraged to provide the valuable quality housing options in which we take great professional pride.
 
“But the good agents will still abide by the rules and the bad ones will carry on as before.”

He added that another concern is the lack of a representative national voice for lettings agents and said there are moves to create a new association of lettings agents.

He said: “The Scottish lettings industry has been asleep at the wheel for a while, and, as a result, we can’t properly influence the direction of any future legislation.

“But a national body for Scotland would give us a grass roots voice that we don’t have at the moment.”