Scotland has extended its rent cap policy by a further six months to March 2024.
Under the extension most in-tenancy private rent increases will continue to be capped at 3%, while enforcement of evictions will continue to be paused for six months for most tenants.
Alongside this, increased damages for unlawful evictions – of up to 36 months’ rent – would continue to be applicable.
Tenants’ rights minister Patrick Harvie said: “As the cost-of-living crisis continues, these measures are giving important support to tenants, providing them with much-needed stability in their housing costs and additional eviction protections.
“As the social housing sector have agreed their rents in consultation with their tenants, the focus of this temporary legislation is on providing private renters with similar protection.”
However, private landlords will be able to apply for up to 6% rent increases if they can prove that exceptional costs have been incurred.
Harvie added: “We know some landlords are impacted by rising costs too. The option of increasing rents by 6% in specified circumstances ensures landlords who may be impacted by the cost-of-living crisis can recover some increased costs associated with their let property.”
The Scottish parliament still has to vote on the extension to the Cost of Living (Tenants Protection) Act measures, but it is expected to be approved without difficulty. Harvie said this would be the final period the legislation would be in force.
But while he said the government was “looking to transition out of these emergency measures”, he appeared to warn that further legislation could be introduced if it was deemed necessary.
“The necessity of these measures is being kept under review and we will continue to assess whether they remain justified, balanced and proportionate based on the financial pressures rented households and landlords are facing.”
The UK Apartment Association, which represents the build-to-rent sector, said it “broadly welcomed” the extension, but expected an exception for BTR.
Gillian McLees, UKAA chair and director of BTR at Rettie & Co, which helped draw up the Scottish Property Federation’s response to the original legislation, said: “The Scottish government has made social housing providers exempt from this cap. As both social landlords and BTR providers hold the same aspirations to deliver good quality housing, in good quality communities, the UKAA argues that the BTR industry should be treated in a similar manner.
“Confidence is required of investors, developers, contractors, and all those involved right through to the customer. This confidence is built through clarity, certainty, and consistency – all of which are undermined by rent control.”
Mclees added: “In principle, the UKAA opposes rent control in any form.” She pointed out Rettie’s findings that “some investors are already pausing and/or withdrawing from the market entirely”
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