Letting Agent Regulation – Raising Standards Across the Private Rented Sector

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Around half of Landlords in the PRS (Private Rented Sector) in Scotland use the service of a Letting Agent.

Many agents do operate in a professional manner, but such good practice is not shared by all.  In response to issues raised by landlords and tenants (who have experienced poor standards and in some cases, illegal practice by some letting agents), the Housing (Scotland) Act 2014 will introduce a framework for letting agent regulation which will include:

  • A mandatory register for letting agents; all staff employed in an agency that are directly managing and supervising the day to day running of a letting agency will need to hold one of two recognised qualifications. Further training will be required for individuals who have held a qualification for more than three years.
  • Agencies must adhere to the Code of Practice. In the event of a breach of this code, a new redress scheme from the new 1st Tier Tribunal Service will be responsible for legal issues relating to the Private Rented Sector.
  • Any client money such as rent, deposits and floats must be held in a separate ‘Client Account’ and must be held completely separate from an agencies business money.
  • Agencies must be a member of a ‘Client Money Protection (CMP) scheme’. The providers of the CMP are responsible for verifying the financial practices of the agency relating to their handling of client money.  If an agency misappropriates the client funds then the CMP scheme will pay out any compensation due to tenants or landlords affected.
  • Agencies should have Professional Indemnity Insurance in place. This insurance protects the agency and their clients against errors made by the agency where a client wishes to pursue a compensation claim.

The proposal is that the register will begin accepting applications in January 2018 and the suggestion is that those wishing to become a registered letting agent should have attained a relevant qualification prior to first registration. The deadline for letting agents to get on the register is September 2018.

We believe that once these measures are implemented, it should help increase the overall standards of professionalism within the letting industry.

At iLet, we’ve already gone through the required training to be able to apply to be on the mandatory letting agent register (see certificate below).

Rest assured, any landlord or tenant that works with us will always be offered a transparent and honest service.

 

 

 

Article written by iLet’s owner, Nykky Banks.