Scottish landlords are poised to regain significant control over rental prices as temporary measures implemented by the Scottish Government to cap rent increases are set to expire on 31 March. The changes mean that from 1 April, landlords will be able to adjust rents in accordance with market conditions without the restrictions that have been in place.
In March of the previous year, the Scottish Government introduced a temporary rent adjudication system to support tenants during a period of escalating costs. This system followed an initial freeze on rent increases, allowing landlords to increase rents by a maximum of 12 per cent if a tenant sought intervention from a rent officer. However, this system is now reaching its conclusion, ending the controlled conditions for rent adjustments.
The Cost of Living (Tenant Protection) (Scotland) Act 2022 initially aimed to stabilise the rental market with strict regulations. This included capping annual rent increases at three per cent, although landlords could apply for an up to six per cent increase under specific circumstances. These temporary regulations are being lifted next week, prompting fears among tenants regarding potential future rent hikes.
From 1 April, landlords will no longer be required to adhere to the earlier rent increase caps. Tenants can expect their landlords to provide at least three months’ notice before implementing any rent increase, although such increases are limited to once every twelve months. If a tenant challenges a rent increase, the final rent will be determined by Rent Service Scotland or the First-tier Tribunal and could potentially be set at open market value, which may exceed the landlord's proposed increase.
Alongside these immediate changes, the Scottish Government's Housing Bill is currently under consideration in Parliament. This bill aims to establish Rent Control Areas, which may introduce a new framework for rent regulation in the future. However, these developments will not affect the immediate changes scheduled for 1 April.
Commenting on the situation, Scottish Green MSP Maggie Chapman expressed concern about the potential implications for renters, particularly with rising living costs. Speaking to the Daily Record, Chapman remarked, "With living costs soaring, a lot of renters will be watching their bills stacking up and worrying about the future. Meanwhile, there will be rogue landlords all over Scotland eagerly waiting to cash-in from the minute that these protections are lifted." She further articulated her apprehension regarding the housing market, asserting that immediate action from the Scottish Government is necessary to protect households from preventable hardship.
As the rental landscape shifts, tenants and housing advocates remain vigilant regarding the broader implications of these changes.
Source: Noah Wire Services