STUDENTS renting accommodation for the first time this autumn are set to be among the first beneficiaries of a new scheme aimed at eliminating disputes over deposits.
Generations of students have discovered to their cost that when you pay a deposit on rented accommodation, there’s no guarantee of getting it back.
But students renting properties this university year will be among the guinea pigs for Scotland’s new tenancy deposit scheme; when tenancies are up next summer any disputes over the return (or not) of their deposits will for the first time be settled independently.
The new scheme came into force in July, and with landlords given until November to comply, experts hope the days of endless arguments over deposits could be over.
An estimated 224,000 rented households will be affected by the legislation and it’s estimated that some 11,000 tenants have all or part of their deposits withheld every year.
Under the new scheme, landlords and letting agents are obliged to lodge tenant deposits with an approved third-party scheme.
They must provide tenants with confirmation of the amount paid in deposit and the scheme that’s holding it, plus proof of registration with their local authority at the time of paying the deposit.
During the tenancy the money lies with the scheme administrator in an account set up for the purpose. If there’s a dispute between the landlord and tenant over the return of the full deposit at the end of the tenancy, it can be taken to a new (free) independent dispute resolution service.
Julie Grieve, managing director at Braemore Property Management, said: “Students must check that their landlord is appropriately registered and that their deposit will go to an approved scheme under the new tenancy deposit scheme (TDS) rules. Too often they are simply in a hurry to get the keys and don’t do the required homework.”
The TDS undoubtedly gives students renting properties a new layer of protection, although there are concerns that the success of the scheme could be undermined by low awareness of it.
There are also fears that landlords will pass to tenants the costs of complying with the scheme – such as more detailed inventories and conditions – in the form of increased rents.
One of the new deposit schemes is run by the Letting Protection Service (LPS) Scotland. A director of the firm, Kevin Firth, said the legislation will help students by removing the worry of unfairly held deposits.
“Both students and landlords can rest assured that come the end of the tenancy, both sides will be fairly represented.
“Any disagreements will be settled by a third-party adjudicator, removing responsibility directly from the landlord. The regulations now in place mark a positive step forward for the Scottish rental market as a whole.”
Firth urged students to ensure their landlord meets their obligations by getting details of the scheme at the outset of the tenancy.
“While it is your landlord’s responsibility to protect your deposit within the set timescales, you should always request information about the provider that they are using, and how you can contact the scheme directly at the end of the tenancy.”
Where there’s no dispute over the deposit both landlord and tenant need to contact the scheme provider, which should pay the money within five working days.
Also watch out for letting agents charging unlawful fees. Landlords and letting agents are only allowed to charge rent and a refundable deposit, under the Rent (Scotland) Act 1984.
Many have also charged fees purporting to cover credit checks, inventories, reference checks and other expenses, prompting Shelter Scotland to launch a campaign helping tenants reclaim those fees. Last month the Scottish government clarified its rules on tenant charges, confirming that anything but rent and a refundable deposit is unlawful.
If you come up against a letting agent or landlord insisting you must pay additional fees, stand your ground because the law is behind you. If you’ve already paid such fees, visit www.reclaimyourfees.com to find out how to recover them.
That’s not all that renters, including students, can do to ensure that a tenancy goes smoothly. Here are a few other tips:
Do your homework
When looking for somewhere to rent, don’t be afraid to ask others about their experiences in certain locations or about their relationships with landlords or letting agents. When you find somewhere, check the landlord is registered, that the place is secure, that the appropriate safety steps are in place (ie smoke alarm, gas safety certificate) and that everything works, from lights and water to phone and broadband.
Get the finances straight
Ensure you’ve made clear arrangements for rent payment and don’t agree to pay upfront fees other than your refundable deposit. Make sure your landlord gives you details of the deposit scheme they are using. Read through the tenancy agreement with care and get an understanding of any rules with which you have to comply (or that you’re not happy with).
While the new tenancy deposit legislation provides extra protection for tenants, you still face losing some or all your deposit if you fail to meet your own obligations. Also make sure your flatmates are aware of the rules, such as liability for bills and breakages.
Firth at LPS also recommended compiling a detailed inventory before or when you move in. “This will help both you and your landlord fairly assess how much of your deposit may be withheld for damages when your tenancy ends,” he said. “Make sure you thoroughly check the inventory provided and detail any existing damage. If you do break anything tell the landlord straight away.”
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