In the strongest warning yet to anti-fees campaigners, new data has shown that rents in Scotland have jumped since fees charged to tenants were banned.
The ban has definitely accelerated rent rises, according to the first Scotland Buy-to-Let Index from Your Move, one of Scotland’s largest letting agents and part of LSL Property Services.
Before it became unequivocally illegal to charge tenant fees in Scotland in November 2012, average monthly rents had been stable at around £508 for almost two years, showing an average annual change of 0%.
However, in the 21 months since the ban, rents in Scotland have gone up at an annual rate of 2.3% – much faster than in England and Wales.
The average residential rent across Scotland is now 2.7% higher than in July 2013, and currently stands at £534 per month.
This means that tenants in Scotland are paying an extra £26 a month in rent on average than before the legislation was introduced, amounting to £312 across a year. This figure, says Your Move, “is substantially more than the typical up-front costs tenants used to pay when setting up their tenancy”.
Scottish rents are, however, still 29% lower than the average rent across England and Wales, at £753.
Gordon Fowlis, 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.
“Banning fees has heightened the financial strain on tenants, as greater costs are now incurred through rents increasing at a faster pace.”
Shelter was instrumental in having the law in Scotland tightened up to ban fees, and has since turned its attention to fees charged in England. Generation Rent has also called in its “election manifesto” for letting agents’ fees to tenants to be banned.