A controversial consultation document about rent controls is proposing that Build To Rent operators be exempt from the caps which may be imposed on buy to let landlords.
A Scottish Government consultation proposes that rent controls would apply to increases in rent that take place both during a tenancy and where the rent is set for a new tenant. It also states that the Scottish Government is “considering whether it would be appropriate, in certain circumstances, to allow an increase in rent that is in excess of the rent cap.”
The Scottish Government also acknowledges that “some landlords choose not to increase rents during the course of a tenancy, and instead prefer to increase rents between tenancies”. If rent controls apply both within and between tenancies, the consultation suggests that “landlords may move to increasing rent during tenancies, [which] they would not have done before”.
However, the consultation also suggests that the Scottish government is considering a rent control exemption for institutional Build To Rent providers, admitting that “some investors may see rent control as a deterrent to investment”.
This may be a response to highly publicised comments by some BTR operators that they were withdrawing their interest in some Scottish developments because of the rent controls which have existed there for the past year.
At least one property commentator has called out the Scottish Government consultation as being unfair to buy to let landlords.
Neil Cobbold - managing director of automated rental payment company PayProp UK - says a Build To Rent exemption would be seen as fundamentally unfair.
Cobbold has also slammed other proposals from the Scottish Government, contained in its consolation document released with little fanfare two weeks ago.
In addition to long-term rent controls, it wants pets allowed in rental properties, tenant modifications to a property, greater eviction protection, alternative uses for unclaimed deposits and a range of social rented sector measures.
Cobbold says: “This consultation, while addressing some key issues within the Scottish rental sector, is not fit for purpose. It imposes choices on respondents, effectively forcing them to adopt one of the prescribed options, even if they have reservations or alternative ideas to propose. It's a very restrictive approach that doesn't truly reflect the complexity of the issues at hand."
Further permanent eviction protections are also under consideration, including whether evictions should be delayed during winter, or where it would cause financial hardship to the tenant. However, the consultation also suggests that a tribunal should consider if a delay would “detrimentally affect the landlords’ health or long term disability or cause financial hardship”.
In addition, the consultation is also considering views on several other issues, including whether all remaining assured and short assured tenancies should become open-ended private residential tenancies.
Respondents are also being asked to consider if tenants should be allowed to ‘personalise’ their rented accommodation by painting and decorating the rented property or to keep pets, and what should be done with unclaimed tenancy deposits.
Interested parties have until October 27 to respond to the Scottish government’s consultation.
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Wow 🤐 they really hate the small private landlord ☠️☠️.
Rent controls don’t work, with the government trying to set the price in any free market. It will breakdown.
Congratulations on today's stupid Scottish Policy. Another fine demonstration of a complete lack of basic economic understanding, so just in case some fool who came up with this nonsense is reading, here's the problem.... New Build Houses sell for more than similar existing houses...as such the rents will be considerably higher than existing properties which you will have held the rents down on...now you as a hard up Scottish comrade in the Peoples Republic of Alba, going to look for a cheaper rent or a dearer rent? As builder of expensive to rent properties, going to want to shift the lot as quickly as possible and run off with the cash or sit around paying interest in the hope you might rent one or two?
Here's a clue....go boil your heed' as they say.
Unbelievable! True communism is alive and well in Scotland and enslaving its people across the board, including those who have worked hard to build their independence and provide housing for those many who need it.
What kind of socio- communist party is the SNP that allows full on Corporate Capitalist dominance in Scotlands housing sector? Then simultaneously crushes small private housing providers for no good reason.
Scotland should be worried, and Scottish landlords should leave on mass now whilst they still can.
We all wish those landlords well.
It is unbelievable how everybody thinks it is acceptable to impose different conditions on private LLs to everyone else. Loss of S21, imposition of S24 & now rent caps, exclusively available to private LLs only!
Have they not noticed that Build-to-Rent rents are higher than the average already? Surely the reluctance of BTR investors to invest in Scotland should indicate to the government there that their policy is flawed. If the lack of rental properties already established is not enough to do it.
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