The Scottish Government has announced a private rent deposit scheme, which will become compulsory from November.
The tenancy deposit scheme is free for landlords and letting agents, and tenants will have access to a free and independent dispute resolution service when the return of a deposit is in dispute, much like the Deposit Protection Scheme currently in place in England and Wales.
Landlords can voluntarily pay deposits into the scheme from today but from November they will have to do so by law.
Housing minister Keith Brown said: ‘These new regulations are historic because they offer, for the first time, a fair, cost effective approach that safeguards tenancy deposits. It is important to stress that the majority of landlords behave responsibly. This legislation is aimed at tackling those who continue to tarnish the image of the private rented sector.’
The Scottish Government has estimated between 8,000 and 11,000 tenants annually have £3.6 million of their deposits wrongly withheld.
Three schemes will be in operation: Safedeposits Scotland, Letting Protection Service Scotland and Mydeposits Scotland. They will take deposits from landlords or their agents for safekeeping and provide information about the tenancy, the deposit and the scheme to the tenant.
The scheme becomes compulsory from November to May 2013, depending on when a tenancy started. A chart to identify when you must lodge your deposit can be viewed here.
Graeme Brown, director of homelessness charity Shelter Scotland, said: ‘Monday 2nd July starts the clock ticking towards the point when all tenants’ deposits will be protected by law in Scotland. Shelter Scotland has been campaigning for this scheme for eight years now and we are delighted to see it becoming law.’
Although, he added: ‘It will only work properly if tenants are diligent and know their rights and landlords and agents embrace the scheme fully.’
Robin Parker, president of NUS (union for students) Scotland, said: ‘This is a great day for tenants and good for landlords. We’ve worked for many years to get better protection for tenants in private flats and houses, including of course the tens of thousands of students who live in the private rented sector.’