Clyde Property in Glasgow has become what is thought to be the first letting agent in Scotland to sign up every single one of its tenancy deposits – at the enormous cost of £2m.
In Clyde’s case, the number was 2,200 and the sum of £2m had to be physically placed into one of the custodial banking schemes.
In Scotland, the legislation does not allow for insurance backed schemes, and it also catches ongoing tenancies as well as new ones.
The legislation kicked in on October 2, meaning that all tenancy deposits received from that date onwards must be handed over for protection within 30 days.
There is a period of grace for older deposits, but May 15 next year is the final deadline.
There are considerable fears that not all agents will be able to hand over money that they may have taken two or three years ago. Scottish agents have also been hit with an explicit legal clampdown on being able to charge tenants fees.
There are some 300,000 privately rented households in Scotland, and it is estimated that the total amount of deposits held by letting agents and landlords is in the region of £75m.
Gary Thomson, managing director of Clyde Property, said: “We fully support the tenancy deposit scheme as this adds security and peace of mind to an industry that has previously lacked accountability and barriers to entry.”
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