Currently, under the Rent (Scotland Act) 1984, landlords and their agents can legally charge rent and a deposit only when granting a tenancy.
However, current legislation has not been explicit enough about additional charges such as reference checks, credit checks and inventory fees.
The law will now be clarified so that all tenant charges, other than rent and a refundable deposit, will be deemed illegal. These will come into effect in November.
Gordon MacRae, Head of Communications and Policy at Shelter Scotland said:
“This 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.
“Shelter Scotland has been campaigning all year for these fees to be outlawed. Our reclaimyourfees.com web site has proved so popular that already more than £100,000 worth of claims against letting agents have been made using our free step-by-step toolkit.”
There is no doubt that some landlords and agents charge excessive fees to set up a tenancy, but there is a cost to set up a tenancy including reference checks, credit checks, inventories etc. If landlords and agents are not able to make a charge for these then rents will rise to cover the cost of setting up a tenancy.
Landlords and agents in England and Wales are not affected by this decision, only Scottish tenancies are affected. However, there is growing demand for Parliament and the Welsh Government to follow suit and ban additional charges. This demand will continue to grow if landlords and agents charge unreasonable costs to set up a tenancy.
We strongly advise all landlords and agents to join TenantVet, the free online tenant referencing service, including all Scottish landlords and agents.