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Landlords and Agents Continue to Battle Scotland Over Rent Controls
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
Landlord and letting agent groups are continuing to challenge the Scottish Government’s plans to introduce rent controls and other measures.
The Scottish Housing Minister, Margaret Burgess, has suggested that the Private Tenancies Bill will be published next week.
The bill, which will be released under devolved powers, is also set to abolish the no fault ground for possession and introduce longer tenancies as ordinary.
Landlords and Agents Continue to Battle Scotland Over Rent Controls
PRS 4 Scotland – including landlords, agents, portals and investors, has lobbied the measures. It notes that 70% of respondents to the Government’s consultation on rent controls were opposed to them.
It is primarily led by DJ Alexander, Rettie & Co, Lettingweb, LetScotland, Braemore and Citylets.
The spokespeople for the group, Dan Cookson and Dr John Boyle, believe that Scotland’s private rental sector should provide long-term, stable and high quality rental accommodation for the growing tenant population. However, they believe that rent controls would “seriously undermine that aim”.
They explain: “The debate has been dominated by calls for the type of rent caps that are seen overseas without sufficient analysis of how these would work in practise to address Scotland’s housing crisis, or recognition of the harm they would do to tenants and as well as landlords.
“The debate has to be broadened out and if there is a need to set limits on rental increases, then there also needs to be the incentives for investment.
“There is much to be commended in the Government’s desire to create a more secure PRS [private rental sector] tenancy for the longer term – if this is what tenants and landlords want.
“However, the possibility of rent controls, limits on taking possession of a property after the lease expires and a one size fits all tenancy agreement are not only causing many landlords to question their continuing role in the sector, they are also a very worrying distraction.”
They continue: “Housing supply is the critical issue and only with healthy and appropriate investment in supply can the demand be met, and can Scotland build a PRS that meets the needs of households across the income spectrum.
“Advocates of rent control often cite Germany as providing both tenant and landlord with a predictable and secure relationship, therefore allowing for longer term investments.
“However, where forms of rent control exist, such as in Berlin, they have been balanced by strong tax incentives and land releases designed to promote supply and encourage private investment in the sector.
“Germany has a tax structure that is predominantly tenure neutral and mortgage lending that is stricter.
“It also has a fiscal and planning environment that has encouraged investment in new homes and tax benefits weighted towards investment in the PRS.
“Cherry picking one aspect of German housing policy and ignoring the others does not lead to better understanding or better policy.”1
