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The number of English buy to let investors registering tenancy deposits in Scotland is up 430 per cent according to new research from SafeDeposits.
This growth is a 226 per cent increase since last year. In 2012, 260 landlords residing in England registered deposits on rental properties in Scotland. In 2017, that number rose significantly to 1,388.
Operations manager at SafeDeposits Scotland, Victoria Smith, explained why Scotland is becoming an increasingly popular choice for landlords.
She said: ‘SafeDeposits Scotland now holds over 3,300 deposits from English landlords on Scottish properties. Scotland has different deposit protection legislation in Scotland from England, and landlords, wherever they are, must ensure that they are using the scheme where their rented property is located. We saw a dramatic rise in registrations in 2017, with 1,388 new registrations, which could be down to a number of contributing factors. For example, variations in rates of Stamp Duty in England and Land and Buildings Transaction Tax in Scotland, may make investing more attractive in the north.
‘It’s interesting to note that the most significant landlord prosecution for non-compliance was a landlord living in St Albans who failed to protect her Edinburgh tenants’ deposits. Seeing that the legislation has teeth may have spurred other English landlords to make sure they weren’t breaking the law. The landlords’ legal representative at the time (2016) explained she was as ‘an amateur landlady’, but the sheriff described her as being ‘dilatory in attending to her obligations.’
She continued: ‘In Scotland, the private rented sector accounts for 15% of the overall housing stock, growing from 5% before the turn of the millennium. While the sector expands and interest from landlords from outside Scotland increases, it is important that they understand the legal framework in which they are operating. For example, navigating deposit protection regulation and private residential tenancy legislation is vital to managing tenancies successfully in Scotland.’