In a move that will send shivers through the entire UK lettings industry, the Scottish government has announced that legislation will be toughened up to ban all up-front fees.<\/p>\n\n\n\n
Scottish housing minister Keith Brown has confirmed that letting agents should not be charging the fees and said that the Rent (Scotland) Act 1984 will be clarified to become unequivocal on the matter. The move also affects landlords who, for example, currently charge tenants for inventories and paperwork.<\/p>\n\n\n\n
While this move has been played out north of the border, it is being seen as a worrying precedent for the rest of the UK.<\/p>\n\n\n\n
What now looks like a crisis for many letting agents in Scotland followed a vociferous campaign by Shelter to ban any and all tenant fees \u2013 for example, reference checks, credit checks and inventory fees.<\/p>\n\n\n\n
The Scottish law will now be clarified so that all tenant charges, other than rent and a refundable deposit, will be deemed illegal.<\/p>\n\n\n\n
Housing minister Keith Brown said: \u201cThe majority of letting agents operate in a thoroughly professional manner and play an important role in the Scottish private rented sector.<\/p>\n\n\n\n
\u201cHowever, numerous cases of tenants across the country being ripped off were uncovered by Shelter Scotland.<\/p>\n\n\n\n
\u201cAs a result of this consultation, we will make it crystal clear to tenants, landlords and their agents that all premium fees, over and above rent and a deposit, are unlawful.<\/p>\n\n\n\n
\u201cWe will now commence the necessary legal provisions to come into force later this year.\u201d<\/p>\n\n\n\n
Gordon MacRae, head of communications and policy at Shelter Scotland said: \u201cThis is great news for everyone who has been ripped off by unscrupulous letting agents. It will finally put an end to this unlawful practice and ensure that tenants are no longer exploited.<\/p>\n\n\n\n
\u201cShelter Scotland has been campaigning all year for these fees to be outlawed.<\/p>\n\n\n\n
\u201cOur reclaimyourfees.com website has proved so popular that already more than \u00a3100,000 worth of claims against letting agents have been made using our free step-by-step toolkit.<\/p>\n\n\n\n
\u201cMoves like this can only strengthen Scotland\u2019s private rented sector and help make it a fairer and more secure place to live for the 270,000 households that now call the sector home.\u201d<\/p>\n\n\n\n
The change in the law, due in November \u2013 the same month as the tenancy deposit deadline \u2013 is likely to hit some agents extremely hard.<\/p>\n\n\n\n
Ian Wilson, managing director of Martin & Co, said: \u201cAs a business we collect around 7% of total revenue in Scotland from the fees being banned.<\/p>\n\n\n\n