Expiry of emergency measures will not end complexity

Proposals have been laid in the Scottish Parliament for the transition away from the rent cap and eviction moratorium under the Cost of Living (Tenant Protection) (Scotland) Act 2022, which ends on 31 March 2024. We acknowledge that provisions to prevent rents rising to a level that will cause hardship to some tenants are justified, however, the Scottish Government must provide more detail about how the transition measures will be applied.

Children's letter blocks spelling out the word rent with hand holding a house block

How will landlords and agents be supported?

More clarification is needed about Rent Service Scotland’s ability to assess market rents, in particular, what data they will use to define market rents. Reassurance is also needed that enough rent officers will be available to support users of the new process and ensure that it is efficient.

We would welcome information about the performance of Rent Service Scotland; how many cases did they determine before the emergency measures and how many were resolved by the First Tier Tribunal?

Real-life application of the taper

A fixed standard approach would fail to reflect local market conditions and so we are in favour of only applying a taper to rent increases where the difference between the current rent and open market rent exceeds a certain level.

It should be considered that some landlords or their agents may be justified in making large rent increases, for example, if they had not raised rents for some time before the emergency measures were put in place. 

Costs are rising exponentially for landlords, including mortgage rates, increasing compliance requirements, and building and labour costs, which means the difference between current and market rent levels could be significant. Where this can be evidenced, landlords should be able to set the new rent level accordingly.

Aerial view of St Andrews Scotland
04 Jan 2024
Cost of Living transition plans will continue to supress rents

Agents are vital to implementation

The proposals are complex, and self-managing landlords will be especially vulnerable to failure to understand or comply with the new rules.

Ministers should encourage landlords unsure about how to navigate the changes to use the Scottish Letting Agent Register to find a reputable agent who can support them.

We also urge the Scottish Government to provide a calculator to support both landlords and property agents in setting rent in line with the transition measures.

The future of the sector

The long-term aim for the Scottish Government must be to re-balance supply and demand levels for private rented property. If demand remains high, more rental property is needed which in turn will reduce the cost of rents. The Scottish Government should look at ways to incentivise new landlords and support existing investors.

A review of all recent tax changes implemented by the Scottish Government and UK Government that impact private landlords is urgently needed. Furthermore, the recent increases in Additional Dwelling Supplement rates which are stopping investment in the sector, should be immediately reduced, or removed.

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