This item was published during the term of a previous administration that ended in April 2007
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Amendment proposed to Housing Bill
19/09/2005
Tenants and landlords will have better protection if there is a dispute over the refund of rent deposits, under powers proposed by the Executive in an Amendment to the Housing Bill.
The powers will regulate how deposits should be handled, give tenants and landlords a clear way of resolving disputes, and speed up the process of returning deposits.
The amendment will allow for a range of options, from voluntary arrangements to a tenancy deposit scheme which will hold deposits centrally.
Communities Minister Malcolm Chisholm said:
"We want a healthy and sustainable rented sector in Scotland, and we know most private landlords provide an excellent service for their tenants.
"A rent deposit is someone's money and it should rightly be protected. Of course, not all deposits are disputed, and some deposits are withheld for good reason, but we know some are not.
"Where this is the case, we want to look at ways of making it easier for landlords and tenants to resolve their dispute without having to go through a lengthy and sometimes costly court process.
"Landlords can decide how much deposit to charge (but no more than two months rent), but there are no regulations on how or where to hold it, when to return it and who benefits from any interest received. The only way resolve a dispute over the deposit is to take legal action, which could include using the small claims court."
Approximately 173,000 households currently rent their homes from a private landlord in Scotland.
It has been estimated that around £45 million is held in tenancy deposits in Scotland, and as much as £1 million may be unreasonably withheld per year.