First Blockchain For The Private Rental Sector to be Introduced in Scotland
A Scottish property company has launched what is believed to be the world’s first ever blockchain database for the private rented sector (PRS). Property letting portal, Citylets, have joined forces with a local blockchain startup, Wallet.Services, to establish a platform aimed at providing a solution to the problem of rising prices in Scotland’s rental market.
The partnership has utilised blockchain technology –which is a secure system of sending and storing data – to help letting agents and local councils in Scotland track and store rental information and receive an analysis of any changes mid-tenancy.
Citylets is hoping that the platform will assist local councils applying to the Scottish government to designate their local authority areas as rent pressure zones (RPZs) by collating the relevant information provided by letting agents.
The need for such a database has arisen from a new Scottish rental law that demands highly detailed RPZ applications which prove that rent increases are excessively high and causing financial difficulties for tenants in their area. The application also needs to show data-led market evidence that the local council is being pressured into providing housing or subsidising the price of housing as a result.
If successful, the Scottish ministers will grant those areas RPZ status and the annual rental increase rate will be capped for existing tenants living there. A move that will surely see big sighs of relief for local councils where this RPZ status is introduced as soaring private sector housing benefit bills are putting a considerable burden on council budgets.
However, finding accurate evidential data is not as easy as it sounds, which is why Citylets came up with the concept of using blockchain as a secure database that stores shareable data on the rent changes faced by Scottish tenants.
Once the data is entered by letting agents, the data is stored cryptographically, offering increased security. It can then be used by both the letting industry and local councils to support RPZ applications to the Scottish government.
Managing Director at Citylets, Thomas Ashdown, said:
“The need for having a cross-organisational data sharing solution in the face of a complete overhaul of letting agent regulations coming December 1.”
From the rhetoric reported and said thus far on this subject, it seems that the best plan for the Scottish Government, in this case, would be to take on the data themselves. To become in effect consumers of it, at least for decisions on how to regulate this already large and growing sector within housing.
Chairman of blockchain technology specialists, Wallet.Services added that their database could solve, “an issue thrown up by legislation passed by the Scottish Parliament, whilst enhancing trust and data quality between public and private sectors.”
Welcoming the new system, Mike Campbell, director of the Council of Letting Agents, said that the new platform is good news as the PRS law will provide a ready solution to the matters that are, as it presently stands, surrounding the lack of rental data in the Scottish PRS.
This new Scottish PRS law is expected to be enforced throughout the UK in the not too distant future so the database will no doubt be utilised across the whole country thus all Letting Agents, not just those based in Scotland will see the benefits of this new law.
By Joy Lewis.