Fees ban blasted by local estate agent

Average property rents have risen much faster in Scotland than down south since it became illegal to charge tenant fees here in November 2012, according to the first Scotland Buy-to-Let Index from Your Move.

It says that average monthly rents had been stable at around £508 for a period of almost two years, showing an average annual change of 0.0%.

However in the 21 months since the ban on tenancy fees came into force, the annual increase in Scottish rents is now said to average at 2.3% - “much faster than the current rate witnessed in England and Wales”.

The average residential rent across Scotland is now said to be 2.7% higher than in July 2013, currently standing at £534 per month.

Your Move says this means that tenants in Scotland are currently paying an extra £26 a month in rent on average than before the legislation was introduced, amounting to £312 across a year.

It adds: “This is substantially more than the typical up-front costs tenants used to pay when setting up their tenancy.

“At an average of £534 a month, this is the highest level of rent in Scotland on record – but is still 29% lower than the average monthly rent across England and Wales, which is £753 in July 2014.”

Gordon Fowlis (pictured), regional managing director of Your Move, said: “Tenancy fees were outlawed in Scotland with the well-meaning intention of protecting thousands of households reliant on rental accommodation.

“But we can see that in reality tenants are starkly out of pocket.

“They are paying much more over a 12 month tenancy than they would have expected to pay for a single set-up fee, adding to the daily cost of living challenge.

“Before this policy was implemented rents had been flat, relaxing the burden on household budgets and giving tenants some breathing space to climb back on their feet after the dark days of the recession.

“Banning fees has heightened the financial strain on tenants, as greater costs are now incurred elsewhere through rents increasing at a faster pace.”

“After the consequences we’ve seen of previous government intervention, the biggest threat to the private rented sector is further unwarranted regulation.”

“As we move into the final furlong before the referendum, all sides need to be careful not to scare landlords off the playing field as private renting is now a key integral solution to fulfilling Scotland’s housing needs.”

He added: “But the next step for the health of the labour market, and tenant finances, is for earnings to pick up.

“It is vital that whatever the outcome of the Independence referendum, the economic recovery stays on course and wage growth is bolstered, so that thousands more households can feel the benefit in their back pockets.”