Feedback from our reports last Thursday about the twin crises brewing in Scotland, over the ban on all tenancy charges and the requirement to put all tenancy deposit money into a custodial scheme, suggests that matters will only get worse.
Anecdotally, we have since heard of a couple of agents in Glasgow ‘doing a runner’ within recent days.
One expert tells us that up to half of lettings businesses in the city will not exist in a year’s time, and that other parts of the country will be similarly affected.
Shelter, the charity behind the drive to get all tenancy charges banned in Scotland, has not announced whether it will take its campaign into Wales and/or England. However, new research out today by Shelter strongly suggests they are not going to let up, with the charity fiercely criticising letting agents nationwide for their fees. More on this story on LAT on Thursday.
The ban on all tenancy charges requires a clarification to existing Scottish law, which is due to be implemented this November. In early November, all tenancy deposits must be placed within a custodial deposit scheme, meaning that agents must physically hand over cash covering the deposits of both new and on-going tenancies.
* Property agents Orchard & Shipman have helped develop an inventory app with Shelter Scotland.
‘Housemate’ creates a full digital record of a property’s full contents and their condition, and is designed to head off disputes between landlords and tenants at the end of a tenancy.
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Comments
Oh dear Oh dear Oh dear.
Let's all get this straight.
First this article conduses/twins two separate issues.
The tenancy deposit regulations apply now and bite in November.
The changes to the Law needed for the fees changes will not come into force until well into 2013. So all concerned have plenty of time to get used to the change. And what is the change?
That if agents are going to charge 'tenant fees' which have ALWAYS been illegal in Scotland they do what they have ALWAYS hitherto done in Jock land - charge the landlord.
I have een in this business over 20 years and can assure you that agents did not start charging tenahts fees until about 10 - 15 years ago. The problem, of course, as in E&W, is that many of the fees are ludicrously high and totally unjustifiably so.
Charge a reasonable fee and a tenant would pay it. Any tenant that objected don't charge them, keep the dodgy practices beneath the stones rather than have them turned over.
Just charge whatever fees to the landlord - who by the way will soon say if they are reasonable or not as unless they can easily recoup it by increasing the rent they will deem them not to be.
Sounds like hips all over again. Pillocks putting stupid ideas into the marketplace where they have no comprehension of good business practice like making a profit from work involved. There will of course in the meantime be a need to increase the monies paid by tenants to cover those who wish to claim a refund soon after.
I dont pay other peoples bills and doubt any others will.
Get paid and then go into administration. Start up tomorrow get paid go into administration etc etc etc.
Lets start a campaign that says Shelter are destroying the rental market for all and see what happens.
New headline Ross:-
SHELTER TAKE THE LETTINGS BUSINESS TO BANKRUPTCY - AGENT FEES SAID TO DOUBLE NEXT YEAR WHEN THEY ARE REINTRODUCED
I do not support the use of tenents security deposits for anything other than failing to comply with their obligations under the aggreement. However, there is a cost to everything and tenants should bear their FAIR share - Shelter obviously think not, as is usual for organisations such as this!
In my view just some of the effects...............
1. Landords costs will increase because they will have to pay for everything. Of course tenants wil love it - among other things they will not have to pay for any of the work, especially abortive work that is usually due to "incorrect" information supplied by them. It' will be a "liars" charter.
2. Many private landlords will just get out of the market.
3. Less property will be availble and what is available will be more expensive to rent.
4. All responsible tenants will pay more via their rent
Think on Shelter!
@ Steve....you are spot on.
do agents in England realise that Shelter are telling tenants in Scotland they can reclaim fees charged at any time over the last 5 years? its not just a cap on revenue going forward, it's retrospective plus there is new aggression from (ex) tenants to deal with daily . the market has changed overnight...as is so often the case this legislation may end up also hurting those they seek to protect.
More DIY landlords for sure.
I'm all for the deposit scheme which will drive out the agents who have nicked Client money. I wish the same would happen in England.
The Shelter campaign on the other hand sounds like a nightmare. It may destroy the dodgy agents who charge genuinely excessive fees, but it will also prevent reputable agents from charging a viable fee for providing a proper and professional service.
All that will be left are the agents who do everything on the cheap and do-it-yourself landlords. In both cases some may be very good but some will be very bad indeed.
Do Shelter really want to drive the professional agents out and take pot luck with cheap agents and do-it-yourself landlords?
Shelter are in danger of whipping up a mob mentality. How long is it before an agent is assualted in the workplace by an angry tenant demanding a fee refund?
Very commendable to hear that Shelter are providing the homeless and unemployed an App for use on their iphones....suppose they expect Landlord to pay for this service also!!!!