Scottish Property Federation warns rent controls could harm housing supply

A leading industry body warns Scotland faces “a lack of supply” if rent controls are not implemented properly.

Speaking at the Scottish Property Federation dinner, chair of the organisation, Stuart Oag, says the upcoming Scottish Housing Bill could hamper investment in the private rented sector.

The Bill contains a package of policy reforms including introducing rent controls and a tenant’s right to keep pets.

Rent controls have detrimental effect on housing market

Mr Oag told guests: “We have taken every opportunity to demonstrate why it is necessary that the introduction of rent control legislation must be done in a way that will facilitate investment in new housing.  Unless we boost supply, we will remain trapped in a cycle of a lack of homes of all types and tenures.

“If we reduce supply, then we will exacerbate the structural deficiencies which currently exist, and which have led to the declaration of housing emergency.”

Industry leaders continue to issue stark warnings to the Scottish government about the potential consequences of introducing rent controls.

Research by Propertymark reveals that rent controls are already having a detrimental impact, particularly on tenants in the private rented sector.

The average rent for a two-bedroom home in Scotland has surged by over 14% as landlords seek to cover rising costs and prepare for the new legislation.

Devil will be in the detail

Mr Oag says the “devil will be in the detail” regarding the Bill but hopes the Scottish government will continue to work with the housing sector.

He said: “I am encouraged by the First Minister’s programme for government statement and in the engagements we have since had with both the Deputy First Minister and the Housing Minister.

“But we do need to see the detail – the next few weeks’ work on the Housing Bill are critical and outcomes will be closely watched by the investment community to see if their red line requirements are delivered.”