Housing (Scotland) Bill: consultation

Ministerial foreword

In March 2024, the Scottish Government introduced the Housing (Scotland) Bill (“the Bill”), bringing forward a package of reforms to help ensure people have a safe, secure and affordable place to live, delivering on the strategies we have brought forward in recent years.

Eradicating child poverty remains this Government’s priority, and vital to this is ensuring families have secure and affordable homes that meet their needs. We know that people who rent their homes are more likely to live in poverty, be financially vulnerable and live on low incomes compared to those who own their home either outright or with a mortgage.

This Government has a strong record of acting to protect tenants, and Scotland has some of the strongest tenants’ rights in the world. In 2022, the introduction of our emergency measures to help tenants through the worst of the cost of living crisis helped to support tenants to stay in their homes.

Our continuing commitment to introducing a long-term system of rent control for Scotland builds on this record and the measures in the Housing (Scotland) Bill set out the framework for how we will achieve this. Our commitment to setting out the form of the rent cap in the Bill offers tenants and landlords clarity on what the effect of rent control will be in areas where it is applied.

We recognise that Scotland needs a thriving private rented sector offering good quality, affordable housing options while valuing the benefit that investment in rented property delivers in meeting housing need and demand and promoting diversification. Our approach to rent control is being tailored to Scotland’s needs, focusing on local circumstances and seeking to stabilise rents for tenants in areas where they are rising too steeply, while an appropriate balance is in place to protect the property rights of landlords.

Throughout the development of the measures in the Bill, we have been working with tenants, landlords, investors and developers to make sure we strike that appropriate balance. As part of these discussions, there have been ongoing calls for further certainty on how rent control will be implemented and how rents will be capped in areas where rent control applies. To respond to this, we are bringing forward this consultation to seek views on how the powers within the Bill could be used to exempt certain types of properties from rent control and the circumstances where rents could be increased above the level of any introduced rent cap.

We recognise that some stakeholders would prefer that exemptions from rent control and circumstances where landlords may be able to increase rents above the level of the rent cap were set out in primary legislation. However, it is essential that decisions in relation to this are informed by full and open consultation, allowing all of those who may be affected by rent control to have their views considered. This will ensure that the impacts of any decisions on the use of these powers are fully understood and the measures are developed in a way that is fair, robust against challenge and can be clearly set out in legislation. Bringing forward this consultation will allow us to provide the clarity being sought and support us to bring forward the secondary legislation at the earliest opportunity.

I am clear that this is the correct approach and engagement with tenants, landlords, investors and developers will continue while the consultation is underway. I would encourage all of those who may be affected by future rent controls to take the opportunity to input their views.

During our previous engagement, we have heard calls for properties let for mid-market rent and build to rent properties to be exempted from rent control areas, including from the Housing Investment Taskforce. We now seek views on exemptions for these categories of property, alongside consideration of any other types of property that should be exempted from rent control restrictions.

We have also listened carefully to concerns raised about increases to landlords’ costs where rent control areas are in force and we will seek views on how these should be considered, including where the landlord has made improvements to the property, or where the landlord has consistently charged a rent that is below the market rates.

Finally, we are seeking views on how regulation-making powers in the Bill could be used to clarify how joint tenancies in the private sector are ended. The Bill includes measures that provide a remedy for tenants ‘trapped’ in a private residential tenancy due to a complete relationship breakdown with other joint tenants. The Bill ensures that no joint tenant can be indefinitely held to a rental contract against their wishes, which will be particularly beneficial to joint tenants where domestic abuse is a factor. The new process will give other joint tenants time to consider their options, seek advice and support and where necessary find alternative accommodation.

I encourage you to respond to the consultation and look forward to hearing your views.

Paul McLennan MSP, Minister for Housing