13 Mar 2019
The private rented sector has been the subject of a range of government interventions over the last couple of years which have had an impact for everyone involved.
From new tax implications on current and potential landlords
through the Additional Dwelling Supplement to the move from Short Assured Tenancies
to Private Residential Tenancies, there is no shortage of new rules and
regulations around what is and has been a critical part of the housing mix.
However, the recent collapse of Edinburgh based letting agent CMC Property Management has brought into sharp focus the challenges of running a letting agency and also the importance of landlords using strong, reputable and properly regulated letting agencies to manage their properties.
Liquidators were called in to CMC Property Management after the firm had experienced financial difficulties. It is understood that they had failed to pass on tenant’s’ January rents to landlords.
In one case, a landlady who was owed around £4,000 said that funds had failed to appear in her account in January and she had subsequently tried contacting the firm, without success. A few days after this the liquidators were appointed.
A new Letting Agent Code of Practice was being introduced by the Scottish Government in 2018 which was intended to provide protection to both landlords and tenants, and ultimately raise standards across the industry.
The new regulations mean that letting agents, or anyone managing property in Scotland is required to join a Register of Letting Agents. In order to register, all those affected will need to provide proof they hold a recent, relevant qualification covering the essential aspects of letting agency work at Scottish Credit and Qualifications Framework level 6 or above.
The consequences of not registering are considerable with possible fines of up to £50,000 and custodial sentences of up to 6 months if convicted.
Adrian Sangster, Leasing Director, Aberdein Considine said: “This was an extremely sad situation, particularly for those who have lost money, but it’s also a reminder of how important it is for landlords to ensure the letting agent they select is properly regulated, handles client monies in accordance with the Letting Agent Code of Practice and are on the Letting Register.
The new regulations have been designed to help everyone involved in the lettings agency world, whether you’re a landlord, tenant or involved in managing properties. There is just no excuse for not registering, and meeting the requisite quality levels. Raising standards for the whole industry should be welcomed, by everyone.”