Major changes ahead for private sector landlords and their agents

  • Insight

22 August 2017

What’s coming: new private rented tenancy

We previously reported when the Private Housing (Tenancies) (Scotland) Act 2016 was passed, in March 2016. The new legislation creates a new form of residential tenancy known as the Private Residential Tenancy (“PRT”). Once the Act is in force it will not be possible to create new Assured or Short Assured Tenancies; existing leases will be phased out, for example a tenant inheriting an Assured or a Short Tenancy will acquire a PRT instead. The ability of a landlord to bring a PRT to an end is more limited than for a Short Assured Tenancy.

The new legislation also contains related provisions including on rent review, and on rent control (in “pressure zones”)

The changes in the Private Housing (Tenancies) (Scotland) Act 2016 have not yet been brought into force. The Scottish Government has indicated that this will happen in December 2017.

The Scottish Government has issued guidance for private sector landlords on the Private Housing (Tenancies) (Scotland) Act 2016, which is available here.

What’s coming: letting agent registration and new Code of Practice

In 2018, anyone doing “letting agency work” (defined in section 61 of the Housing (Scotland) Act 2014) must register. Failure to comply can lead to a fine, imprisonment, or both. We have previously issued a note on this, which is available here.

Letting agents will be bound by a new Letting Agent Code of Practice. The Code of Practice comes into force on 31 January 2018. The Code can be accessed here (but please be aware that this version may not include any amendments). It covers various matters including standards of practice, taking on, conducting, and completing work, complaints, handling money, and insurance. Failure to comply with the Code can lead, ultimately, to a fine.

What’s already here: compliance

Private landlords must continue to comply with a variety of standards and regulations. These include:

  • landlord registration (including the obligation to notify the local authority when an agent is appointed);
  • use of a tenancy deposit scheme;
  • issuing new tenants with a Tenant Information Pack;
  • holding a House in Multiple Occupation (HMO) licence where required;
  • meeting the repairing standard (which includes rules on smoke alarms, carbon monoxide detectors, and electrical safety inspections, as well as the state of the property and its contents);
  • gas safety; risk assessment of hot and cold water systems for Legionnaire’s disease; and,
  • provision of Energy Performance Certificates.

Note that the Tenant Information Pack is periodically updated and so should always be searched for and downloaded afresh from the Scottish Government’s Beta website on each occasion it is needed, at the time it is needed, in order to avoid using an out-of-date Pack.

What’s here: First-tier Tribunal for Scotland, Housing and Property Chamber

As we previously reported, the Housing and Property Chamber of the First-tier Tribunal for Scotland – established in December 2016 – is taking over various functions in relation to private housing rentals. Already transferred are: (a) determination of a rent fair to landlord and tenant; (b) ensuring that the Repairing Standard is adhered to; and (c) assisting landlords seeking access to their leased property in order to assess its condition or to carry out works to meet the repairing standard.

At a date still to be appointed, the Housing and Property Chamber will also take over matters such as arrears of rent, tenancy disputes, and termination of tenancies in relation to Regulated Tenancies, Short-Assured Tenancies, and Assured Tenancies, which at present are dealt with in the Sheriff Court.

The Private Housing (Tenancies) (Scotland) Act 2016 provides the that First-tier Tribunal (in practice, the Housing and Property Chamber) will be the vehicle for dealing with issues arising under that Act when it is fully in force – for example, a failure by a landlord to provide a tenant with a written tenancy agreement, or appeals in relation to the variation of rent, or matters relating to termination of a tenancy.

For more information on this topic, contact