Registration will help tenants and agents

The Scottish Government’s latest draft Housing Bill includes the introduction of a registration scheme for agents, a code of conduct and the right of redress for landlords and tenants to take their agent to tribunal.

RICS (Royal Institution of Chartered Surveyors) supports the government’s proposal to regulate letting agents to protect tenants from poor practice and to protect landlords’ investments.

Running a letting agency seems straightforward and simple – you just need to find a tenant and book a contractor to fix things from time to time.

In reality, however, it requires a range of property and financial skills; an understanding of complex housing law; an ability to account for substantial flows of client money; people management and negotiation; and the ability to manage a network of providers associated with legal services, credit checks, repairs and maintenance. The achievement of professional standards is therefore vital.

There are approximately 1,000 agents in Scotland and probably less than 150 of these are fully regulated by RICS or ARLA (Association of Residential Letting Agents). Although around 300 more belong to one of the various trade associations, any code of conduct is often short on detail and crucially there is no enforcement.

The Scottish Government is worried that those letting agents that cannot afford training and accreditation would go out of business. Unfortunately, it is the nature of any well-regulated market that there are basic entry requirements. If agents are not qualified to operate in the market or cannot afford to provide basic protection for their customers they should leave the market.

It is likely that the Scottish Government’s code of conduct will be clear, definitive and cover the main points required. However, through amending the Housing Bill to allow for professional bodies to maintain the register of letting agents, and enforce the code of conduct, effective regulation can be achieved and standards raised for both tenants and landlords.

• Jonathan Gordon is chair of RICS Scotland Private Rented Sector Forum