A consultation by the Scottish Government on rented sector reform and rent control has received criticism from Neil Cobbold, managing director of client accounting and automated rental payment specialist PayProp UK.
The consultation, which included long-term rent controls, pets in rental properties, tenant modifications, eviction protection, uses for unclaimed deposits and social rented sector measures was released on 29th September 2023.
It raised industry concerns due to its prescriptive response options, which Cobbold said failed to allow for genuinely diverse perspectives within the private rented sector (PRS).
Cobbold said: “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.”
The consultation stakeholder paper stated: “It is proposed 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 stated that the Government was “considering whether it would be appropriate, in certain circumstances, to allow an increase in rent that is in excess of the rent cap.”
The Government also acknowledged 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 paper suggested that “landlords may move to increasing rent during tenancies, [which] they would not have done before.”
The paper promised to address this in future proposals.
Cobbold said if landlords were restricted in how much they could raise rents outside tenancies, this could encourage them to automatically apply the biggest rent increase they could during tenancies, raising rents for a greater number of tenants annually.
However, the consultation suggested that the Scottish Government was considering a rent control exemption for build-to-rent providers, saying that “some investors may see rent control as a deterrent to investment.”
Cobbold said this would be perceived as unfair, as it could leave private landlords being restricted in how much they can raise rents whilst large-scale corporate property owners would be allowed to increase rents as they saw fit.
Further permanent eviction protections were 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 suggested that the tribunal should consider if a delay would “detrimentally affect the landlords’ health or long-term disability or cause financial hardship.”
In addition, the consultation considered views on several other PRS issues, including whether all remaining assured and short assured tenancies should become open-ended private residential tenancies.
Respondents were also 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.
The right to keep a pet was similar to measures found within the Renters (Reform) Bill in England.
Cobbold said that while letting agents were encouraged to respond to the consultation, speaking to their MSP would be key.
He added: “Ultimately, no matter what the overall response to the consultation is, it will be your MSP that will scrutinise, amend and ultimately vote on these measures.
“Letting agents can demonstrate their experience and expertise by highlighting to their MSPs the issues that both tenants and landlords will face with the various proposals under consideration.”
