Scotland hits landlords with a 3% rent cap

Scotland hits landlords with a 3% rent cap

0:02 AM, 20th January 2023, About 2 months ago 24

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Emergency measures that saw a rent freeze and an evictions moratorium being introduced in Scotland will now see rent rises capped at 3% in the private sector from April, the Scottish Government has revealed.

The enforcement of evictions will still be prevented ‘in most cases’ but landlords could raise rents by 6% if they apply to do so.

That is only to help cover certain increases in costs in ‘defined and limited circumstances’.

The changes to the Cost of Living (Tenant Protection) Act are still subject to Parliament’s approval.

Evictions are still banned for all tenants

And while evictions are still banned for all tenants – except in specified circumstances – the damages for unlawful evictions are being increased.

Also, the rent cap for student accommodation will be suspended which, the government says, recognises its limited impact on annual rents that are set on the basis of an academic year.

The temporary measures will start on 1 April and be extended to 30 September, with the option to extend for another six-month period if required.

‘Helped protect tenants facing the cost-of-living crisis’

Tenants rights’ minister Patrick Harvie said: “Our emergency legislation has helped protect tenants facing the cost of living crisis.

“With many households still struggling with bills, it is clear that these protections are still needed to give tenants greater confidence about their housing costs and the security of a stable home.”

He added: “While the primary purpose of the legislation is to support tenants, I recognise that costs have been rising for landlords too.

“That’s why we intend to allow those in the private sector to increase rents by up to 3%, with a continued safeguard allowing them to apply for larger increases to cover specified rising costs they might be seeing as landlords.

“By allowing increases in rent – capped well below inflation and limited to once per 12 months – we can continue protecting tenants from the minority of landlords who would impose unaffordable rent hikes.

“We will continue to carefully monitor the impacts of this legislation, working with tenants and landlords to protect them from this costs crisis.”

Allow rents to increase by 3% and by up to 6%

The statement by Mr Harvie that the Scottish Government will allow rents to increase by 3% and by up to 6% in the private rented sector from 1st April is a sign ‘that they have seen sense’.

That’s according to a leading property firm DJ Alexander, which is the largest lettings and estate agency in Scotland.

David Alexander, the firm’s chief executive officer, said: “This shift in policy to allow rent increases in the private rented sector from 1 April onwards is a sensible approach following serious concerns from all parties.

“This will hopefully provide some breathing space for the private rented sector which has seen investment slow or stop, a reduction in the number of homes available, and increased pressure on tenants who have been unable to find appropriate homes.”

‘A rent freeze is a knee-jerk reaction’

Oli Sherlock, the director of insurance at Goodlord, said: “A rent freeze is a knee-jerk reaction which, although it might help some tenants in the short run, is unsustainable and has the long-term impact of pushing more landlords out the market and squeezing the availability of rental homes.

“A price cap is a more sensible step forward than a freeze, but it’s still not addressing the key issues facing the market today.”

He adds: “We have an economic and regulatory environment that is driving landlords away from the sector and not enough homes to go around.

“Unless decision makers explore long-term ways to address the housing shortage and keep landlords from leaving, sticking plaster solutions are only delaying the impact of rent rises on tenants.”

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15:18 PM, 20th January 2023, About 2 months ago

Reply to the comment left by Mr.A at 20/01/2023 - 15:07
So can you get rid of a tenant to do major renovations? Or a major upgrade required to comply with EPC regulations? Or does the tenant have the right to stay put while you do it or be provided with temporary accommodation by you?

Dylan Morris

15:44 PM, 20th January 2023, About 2 months ago

Sorry if I’m a bit thick, I am understanding all this correctly:
1. Evictions have been prevented until end of March this year, so tenant in arrears landlord cannot even start eviction proceedings until end of March. Now this is being extended so landlord cannot do anything now until what time ? September ? When ?
2. Tenant moves out and landlord puts property back on market does the 3% rent cap apply or can landlord charge whatever he considers to be the market rent ?


16:55 PM, 20th January 2023, About 2 months ago

Reply to the comment left by Peter Cochrane at 20/01/2023 - 12:01
The Depriving the general populace of property by "raising taxes" was all part of the plan the progress of which was written about in around 1895 but then that has always been called a conspiracy theory; the drawing of labour from the land and the humbling of the landed aristocracy to be replaced by an industrialised plutocracy is all part of the same right up to today, why else would Bill Gates be owning by law evading trusts over 250,000 acres of farmland and the likes of BlackRock and Vanguard be buying up at a premium tens of thousands of private homes.
Does it makes sense, yes, of course, to the 0.01%


17:19 PM, 20th January 2023, About 2 months ago

Social landlords capped at 6% also from the last budget, so there rents go up 6% and PRs only by 3% with a few exceptions.

Neil MacDonald

19:25 PM, 21st January 2023, About 2 months ago

Reply to the comment left by Mervin SX at 20/01/2023 - 00:07
Tradesmen shouldn't have their income capped. Neither should landlords.

Neil MacDonald

19:29 PM, 21st January 2023, About 2 months ago

Reply to the comment left by Beaver at 20/01/2023 - 11:14
Not a single party state. The parliment is made up of proportional representation. As system imposed by Westminster to prevent any one party having absolute control. I.e. to stop an independence supporting party.

Neil MacDonald

19:32 PM, 21st January 2023, About 2 months ago

Rent caps and evictions don't work. It was tried in Ireland and caused rents to rocket. It was quickly abandoned. I've already seen the rents of new properties in my areas explode.

Jessie Jones

23:08 PM, 21st January 2023, About 2 months ago

Where a landlord needs to put the rent up by, say 7%, just to stand still, but they are prevented from doing this they may well have to sell the property, making the tenant homeless. If the tenant would prefer to pay the extra 7% and get to stay in their home, is the landlord still forced to make the tenant homeless in order to sell the property notwithstanding that both the tenant and the landlord might be happy with a 7% rise?

It strikes me that there is an argument for us all to speak with all our tenants, and say "Look, I need to put your rent up to the absolute most you can afford right now, to protect your interests in the future" "If the UK Government adopt the same rent cap ban and mortgage interest rates go really high, we will not be allowed to come to a deal between us which would allow you to stay in your home." "The Government would prefer that you lose your home than pay a realistic amount to live here" "It is simply the threat of rent caps that is causing this, not rent caps themselves. Once rent caps are in place, we are both buggered. But whilst there is the threat of them, we can increase your rent to almost unaffordable levels just so that you stand a better chance of not being made homeless in the future"


9:24 AM, 22nd January 2023, About 2 months ago

Reply to the comment left by moneymanager at 20/01/2023 - 16:55
So Blackrock and Vanguard are buying up tens of thousands of homes are they? So I can invest my pension in a fund that buys homes but I can't invest my pension in buy-to-let?


9:51 AM, 22nd January 2023, About 2 months ago

Reply to the comment left by Beaver at 22/01/2023 - 09:24Yup!
That's so they can cream off most of the profit/capital gain and just throw a few percent into your pension pot (and a few grand into Tory coffers, and a few lucrative non Exec jobs for Ministers stepping down e.g. George Osbourne).

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