Further measures to safeguard millions of pounds in deposits paid by tenants renting properties in Scotland, have been introduced, it was announced today.
Housing Minister Keith Brown has approved two more tenancy deposit schemes from SafeDeposits Scotland and Mydeposits Scotland.
Annually, tenancy deposits amount to over £74 million in the majority of the 273,000 households that make up the private rented sector in Scotland.
It has been estimated that up to 11,000 tenants have £3.6 million of their deposits wrongly withheld each year. The first tenancy deposit scheme – administered by Letting Protection Service – was approved by Ministers in April.
The schemes also aim to protect the reputation of the majority of private rented sector landlords who act professionally and responsibly.
Once in place landlords or their agents must pay deposits to an approved scheme and provide key information about the tenancy, the deposit, and the scheme which is protecting it, to the tenant.
The scheme will be free for landlords and letting agents to participate in and will offer an independent dispute resolution service to deal with legitimate disagreements over deposit returns as a quicker and cheaper alternative to taking legal action.
All three schemes will operate across Scotland from July 2, 2012 when the legal requirement to submit deposits into a scheme will begin. In order to provide landlords with time to prepare the first category of deposits to be paid into the schemes will be from November this year.
Keith Brown said:
“It’s important to stress that the majority of landlords act responsibly. These schemes are aimed at those who tarnish the image of the private rented sector and exploit trusting tenants.
“This Government is committed to taking action to ensure tenants receive a fair deal, it’s not right that up to 11,000 tenants annually have £3.6 million of their deposits wrongly withheld.
“From July 2, the new regulations will allow a new cost effective approach to safeguarding tenancy deposits, protecting tenants and landlords. Anyone looking for more information should visit the schemes’ websites.”
Graeme Brown, Director of Shelter Scotland, said:
“Monday 2nd July starts the clock ticking towards the point when all tenants’ deposits will be protected by law in Scotland.
“This means that, finally, the unfair withholding of millions of pounds from deposits by landlords and agents will be a thing of the past, as will the hardship it causes to tenants.
“The introduction of a compulsory scheme to safeguard deposits is a step in the right direction towards protecting tenants, landlords and agents.
“We hope the tenancy deposit scheme achieves a transparent and fair system for all.”
Further information about what tenancy deposit schemes means for tenants and landlords can be found on the Scottish Government website or on the individual scheme web sites: