Scotland’s rent control amendment for student accommodation faces backlash

An amendment in the Scottish Housing Bill to allow rent controls for purpose-built student accommodation will have a “chilling effect” on investment, claims an industry body.

Under the Scottish Housing Bill, local authorities would be required to assess local rents and recommend to MSPs whether rent controls should apply in their area.

However, the Scottish Property Federation claim student accommodation has different needs and demands from the private rented sector and allowing rent controls for student accommodation will disrupt supply.

In England, purpose-built student accommodation will be exempt from the Decent Homes Standard, whilst landlords will still have to follow the rules.

Amendments were minor changes to the rent control provisions

A proposed amendment by Scottish Conservative MSP Graham Simpson to include student accommodation in potential rent control measures was passed, receiving support from Green and Labour MSPs.

During the Local Government, Housing and Planning Committee’s debate on the Scottish Housing Bill, Simpson acknowledged that while the Scottish Conservatives oppose rent controls in principle, it would be unfair to exclude students should such controls be implemented.

When asked by Property118 about the Scottish Conservatives’ stance on rent controls, a party spokesperson said they remain firmly opposed.

A Scottish Conservative spokesperson told Property118: “These amendments were minor changes to the rent control provisions. We remain opposed to rent controls and have submitted amendments to remove them from the Bill.

“The Scottish Conservatives do not support an expansion of rent controls and will vote to stop these plans from going through.”

Disrupt investment

The Scottish Property Federation warns the amendments could threaten supply to the student accommodation sector.

Scottish Property Federation, Director David Melhuish, said: “The SPF is deeply concerned that amendments to introduce rent controls for Scotland’s purpose-built student accommodation (PBSA) sector. These amendments to the Housing (Scotland) Bill threaten to disrupt investment into much needed new student accommodation.

“The PBSA sector plays a critical and growing role in supporting Scotland’s world-class university sector by providing vitally needed accommodation to support students. PBSA also takes pressure off the wider rented sector in our cities by reducing competition between students and other residents.”

He adds: “Student accommodation has different needs and demands to the wider private rented sector, and PBSA operators and universities have specific tenancy demands driven by the academic year.”

“The amendment, unless revoked later in the Bill’s journey, will have a chilling effect on investment in this key sector and will further reduce the supply of accommodation available to students. It also leaves many unanswered questions about how rent controls could work in practice for PBSA.”

A Scottish government consultation on rent controls is currently open, considering rent control exemptions for landlords. The Scottish Association of Landlords (SAL) has welcomed the consultation, having previously warned that rent caps will backfire.

The consultation considers that landlords could be allowed to increase rents above the rent cap. For example, where there have been improvements to their property or where rents have consistently been charged at a level below market rates.