Landlords in Scotland hit by rent cap extension

The Scottish government looks set to extend its rent cap for another six months in the private rented sector in a bid to ‘support tenants’.

That would mean landlords will be restricted to rent rises of 3% and the moratorium on evictions continues.

Tenants’ Rights Minister Patrick Harvie says the provisions of the Cost of Living (Tenant Protection) Act will be extended until 31 March 2024, at the latest.

Mr Harvie said: “As the cost-of-living crisis continues, these measures are giving important support to tenants, providing them with much-needed stability in their housing costs and additional eviction protections.

“As the social housing sector have agreed their rents in consultation with their tenants, the focus of this temporary legislation is on providing private renters with similar protection.”

‘Scottish landlords and letting agents will be disappointed’

A spokesperson for Propertymark said: “Scottish landlords and letting agents will be disappointed to see that Propertymark’s evidence has not been considered, which clearly demonstrates the devastating impact the legislation is having on the rental market in Scotland.

“Our latest response to the Scottish government’s call for evidence showed that 100% of our members in Scotland now report evidence of landlords looking to sell their buy-to-let properties.”

The spokesperson added: “Government ministers continue to deny that this is an issue, but we know that the private rented sector in the country has been impacted.”

John Blackwood, the chief executive of the Scottish Association of Landlords (SAL), said: “We are not surprised by the decision of the SNP/Green Scottish government to extend their rent freeze and eviction ban which we continue to believe is disproportionate and is further exacerbating Scotland’s housing crisis.

“Working with partners, we have challenge the initial legislation in the Court of Session and await the outcome of that process.”

The extended law in Scotland

If the extension is approved, the law would see:

• A continued 3% cap on most in-tenancy private rent increases
• The option for private landlords to request up to a 6% increase to cover specific, evidence-backed cost escalations within a designated timeframe
• A further six-month pause on eviction enforcement for the majority of tenants, barring particular circumstances
• The preservation of increased damages for unlawful evictions, amounting to up to 36 months’ worth of rent.

‘Some landlords are impacted by rising costs’

Mr Harvie said: “We know some landlords are impacted by rising costs too.

“The option of increasing rents by 6% in specified circumstances ensures landlords who may be impacted by the cost-of-living crisis can recover some increased costs associated with their let property.

“The final date of 31 March 2024 would be as long as the rent cap and eviction protections could run if approved by Parliament.”

He added: “The necessity of these measures is being kept under review and we will continue to assess whether they remain justified, balanced and proportionate based on the financial pressures rented households and landlords are facing.

“We are also looking at how to transition out of the emergency measures, and we continue to listen to and work hard with stakeholders to develop and deliver rental sector reform.”

Meanwhile, social rented sector tenants can rely on the voluntary agreement established with social landlords, which ensures below-inflation rent increases for the current financial year.