The new letting agent registration introduced by the Scottish Government in January this year has increased the workload for many letting agencies in Scotland over the last few months. After a 9 month transition period for the new register, letting agency registration becomes compulsory from the 1st of October 2018. Every letting agency in Scotland must be registered to operate legally. The criteria for being granted a registration (and permit to operate) is rigorous and game-changing for the sector.
Through a combination of required qualifications, accounting practices and a compulsory code of conduct, the Scottish Government have significantly raised the bar on letting agencies in Scotland making it the most professional and progressive in the UK… by some distance!
The new high standards are not met easily for many agencies. There are a small minority of letting agencies in Scotland that complied with the new requirements prior to this year via their ARLA Propertymark accreditation (and we are pleased to say that Umega is one of these agencies) but most agencies have spent 2018 making changes to their business practices and staff training to meet the new requirements. This has meant a lot of work behind the scenes and changes to some traditional practises that are no longer acceptable under the new legislation for agencies.
For some letting agencies, the work and changes that are required are a bridge too far or are the opportunity for agency owners to call time and exit the market. 2018 has already seen consolidation in the sector and we expect there will be more over the next 5 weeks as the deadline approaches. There will be fewer agencies trading at the end of this year compared to last and the remaining agencies will be of a bigger average size as the number of rental properties in the sector overall continues to grow.
If your letting agency is going through changes, selling up or getting out of the market, then it’s likely it’s in response to the new requirements on letting agencies in Scotland. The new rules will make the sector a much better and safer place for tenants and landlords and is undoubtedly a good thing.
The introduction of the new rules will affect the landscape of the letting agency market over the next few weeks.