The Scottish Government is moving ahead with controversial plans for a freeze on the cost of rented housing and also a moratorium on evictions.

Proposals announced last night are for an initial six months, but could be extended for another 12 months.

Landlords have already warned that capping rents would be a threat to the property market.

The Scottish Association of Landlords has not ruled out potential legal action in response.

The Scottish Government's emergency bill is aimed at freezing most rents until the end of March 2023.

There are exceptions where a landlord faces increased property costs, mortgage-interest payments and some insurance costs.

Evictions moratorium

The legislation also provides for a six-month moratorium on evictions.

Tenants' Rights Minister Patrick Harvie said the move was an "emergency response" to the cost-of-living crisis.

The BBC says the Cost of Living (Protection of Tenants) (Scotland) Bill will be fast-tracked through the Holyrood scrutiny process in a matter of days.

If approved, it will give ministers temporary power to cap rents for private and social tenancies.

It covers the period from September 6 until at least March 31 and includes additional power to maintain or vary the rent cap over two further six-month periods.

The legislation also proposes that the enforcement of eviction actions resulting from the current economic climate will be prevented over the same period, except in a number of specified circumstances.

Application to a rent officer

The Telegraph reports that the bill would allow landlords to make an application to a rent officer asking for permission to impose a rise above the cap set by ministers.

But they are only allowed to ask for a rent rise equivalent to "no more than 50%" of the increase in their mortgage interest payments. In addition, any rent rise given the green light must be capped at 3%.

This means landlords could be left hundreds of pounds out of pocket each month if interest rates continue to surge.

The legislation will be rushed through Holyrood this week with just three days of scrutiny. It was published last night, hours before MSPs on the local government committee were due to take evidence on it this morning.

Community housing associations, letting agents and economists have previously warned that the bill will backfire by prompting landlords to withdraw their properties from the rental market, thereby exacerbating housing shortages.

The Scottish Federation of Housing Associations said the freeze could mean their members would stop building affordable new homes, adding that the proposals have "serious unintended consequences".

Evidence of policy impact

The Tories have cited evidence of the policy's impact in other countries, arguing that the average waiting time for a rent-controlled property in the Swedish capital Stockholm is nine years.

Citylets says that the average two-bed property in Scotland's private rented sector cost £892 a month in the second quarter of this year - a 10.8% increase year-on-year.

Over half a million Scottish households live in social rented housing, managed by councils and housing associations.

Rent is the main source of income for housing associations, who must maintain properties, meet energy standards and pay staff.

More like this…

View all