Private Rented Sector Stakeholder Engagement Group minutes: March 2025

Attendees and apologies

• Minister for Housing, Paul McLennan MSP

• Anna Gardiner (SLE),

• Caroline Elgar (SAL)

• David Melhuish (SPF)

• Emma Saunders (Living Rent)

• Rhuaraidh Fleming (Crisis Scotland)

• Ronnell Reffell (UK Finance)

• Stephanie Mander (CAS)

• Timothy Douglas (Propertymark)

• Scottish Government (SG) Officials

Apologies

• Aoife Deery (CAS)
• Callum Chomczuk (CIH)

Items and actions

The Chair welcomed attendees to the thirteenth meeting of the PRS Stakeholder Engagement Group.

Minutes from the previous meeting were issued prior to this meeting. Members were invited to submit any comments or amendments on the draft minutes by 14 March 2025.

Update on the Housing (Scotland) Bill process

The Chair updated group members on recent developments with the Housing (Scotland) Bill (‘the Bill’).

Stage 1 of the bill process is now complete, and Parliament has agreed the general principles of the bill.

Parliament has agreed that:

• Stage 2 will be completed by 29 May 2025
• Stage 2 proceedings for the Bill will be split between the Local Government, Housing and Planning Committee and the Social Justice and Social Security Committee
• The Social Justice and Social Security Committee will consider amendments to Parts 5 and 6 first, in March
• The Local Government, Housing and Planning Committee will then consider any other amendments.

Ministers have also committed to consulting alongside the bill process on how the regulation-making powers in the bill to exempt properties from the rent cap and to apply a modified rent cap could be used.

There is not a firm date for the launch of the consultation yet, but officials will let members know when this is confirmed.

Housing (Scotland) Bill: discussion with Minister for Housing

The Minister for Housing welcomed members. He was keen to hear their reflections on the Housing (Scotland) Bill and on the upcoming expiry of the Cost of Living (Tenant Protection) (Scotland) Act 2022 transition measures at the end of March.

The Minister acknowledged the importance of balancing rented sector reform with support for investment in the sector, and emphasised that he is keen for engagement with stakeholders on this to continue at both ministerial and official level.

Citizens Advice Scotland

CAS are keen to see an amendment to the bill which would increase the period for a tenant to seek rent adjudication from 21 to 30 days, which they consider would balance the tenant’s need for time to seek advice with the time needed for a rent officer to make a decision on the proposed rent increase before it is due to take effect. 

They are concerned that the expiry of the Cost of Living transition measures could lead to an increase in people having to leave their homes due to high rent increases, and potentially to an increase in homelessness.

• SG is considering whether a 30-day initial period for a tenant seeking adjudication could be made to work. Officials are also aware that other stakeholders are seeking a longer period (42-days), although there are concerns that this could risk tenants falling into arrears if increased timescales mean that rent decisions are not made until after the rent increase date.
• The Minister is very aware of tenant concerns regarding the expiry of the Cost of Living transition measures.
• Officials confirmed It would not be possible to use measures under the emergency Cost of Living (Tenant Protection) (Scotland) Act 2022 as a bridging mechanism until the longer term rent control framework in the Housing (Scotland) Bill is in place.

Living Rent

Living Rent also expressed concern about the ending of the Cost of Living transition measures. Their members are very concerned about the potential for high rent increases.

Living Rent have carried out some research on rent officer decisions and have seen some rent increases which could have been 20% if it were not for the transition measures. They were also concerned that tenants could be evicted after successfully challenging an unreasonably higher proposed rent increase through the rent adjudication system.

Regarding the Bill, Living Rent expressed concerns around data and whether local authorities will have the resources to collect the data needed.

They emphasised the importance of between-tenancy rent control being preserved in the design of the rent control framework.

They also expressed a view that they considered not all local authorities were complying with National Planning Framework 4 (NPF4) requirements, and that exemptions from rent control should not be applied to developers who are not providing affordable housing in a development.

Living Rent are keen to see the upcoming consultation publicised in a way that every tenant in Scotland will be made aware of it.

• The Minister set out that the measures under the Cost of Living (Tenant Protection) (Scotland) Act 2022 were put in place in response to the cost of living crisis, and therefore could not be extended indefinitely.   
• The Minister agrees on the importance of preserving the application of rent controls between tenancies as well as within tenancies.
• The upcoming consultation covering the possible use of powers to exempt properties from rent control will be open to all, and the Minister is keen to hear views from as many people as possible.
• The Minister is also keen to see more information around the Living Rent concerns on adherence to NPF4, and asked that more detail be shared with officials, noting that this overlaps with other Ministerial portfolios and he would need to liaise with those Ministers.
• Officials have previously worked with tenancy deposit schemes to reach tenants with information on consultations, as well as encouraging landlords and local authorities to pass information on to tenants. SG would also be grateful for the assistance of Group members in publicising the consultation as widely as possible when it is launched. 

Propertymark

Propertymark asked about the length of time the consultation will be open, whether the analysis is expected to be complete before the bill process is finished, and whether the outcome of the consultation could lead to changes on the face of the bill, or whether these would feed into regulations instead.

• The Minister confirmed that the consultation will be a full consultation, and will relate to the possible use of the regulation-making powers set out in the bill.
• The timeline for the consultation and subsequent analysis is still under consideration, but it is hoped that this will be finalised soon.
• Officials confirmed the consultation will be open for 12 weeks, and that, whilst analysis of the consultation could take some time depending on the number of responses, SG is working to expedite timescales for this as much as possible.

Propertymark

Propertymark expressed concern that the 32 local authorities in Scotland could report the results of their assessments of rent conditions at different times, and that the bill does not specify how the size of rent control areas should be defined, which they are concerned could lead to uncertainty and inconsistency.

They also consider that the bill should include a statutory timescale for Scottish Ministers to report back on the local authority reports received, to reduce uncertainty.

They are keen to see a review of taxes which affect landlords.

They consider that local authorities should be collecting information from landlords on the reason for any proposed rent increases.

They asked whether there would be a Tenancies Board similar to the one in the Republic of Ireland, or whether rent officers or the landlord and letting agent registration systems could be used to collect data on rents.

• The Minister set out that there are ongoing considerations around long-term collection of data on the PRS, not just in relation to the rent control powers in the Bill, but also more broadly.
• The Minister acknowledged Propertymark’s concern in relation to the potential for different delineations for rent control areas, but set out that this was intended to allow for consideration of different circumstances in different areas.
• He was clear on the importance of monitoring the operating of the legislation during implementation.
• The legislation needs to be flexible to take account of local nuances, but the assessments carried out by local authorities will be underpinned by guidance from Scottish Ministers, which will ensure consistency where this is needed.

Propertymark

Propertymark expressed concern that the current drafting of the legislation did not explicitly require Scottish Ministers to provide such guidance and that they would prefer the drafting to say Ministers ‘must issue guidance’ rather than ‘may issue guidance’.

Living Rent

Living Rent asked when there would be an update on the ongoing work on data.

• Officials will share more information on this work with the Group when this is available.

Scottish Association of Landlords

SAL welcome the coming expiry of the Cost of Living transition measures, which they consider will allow the market to re-set ahead of any future rent controls, whilst stressing that they do not want tenants to face high rent increases.

They are therefore keen to see details of any exemptions to rent control set out on the face of the bill, including for cases where a landlord has been charging a rent below the market rent, in order to give greater certainty to the sector more quickly. They are concerned that without this, landlords may raise rents higher in the meantime than they would otherwise have done.

• The Minister emphasised the importance of seeking a wide range of views on the potential use of the powers.
• He acknowledged the importance of giving certainty to the sector as soon as possible; consulting alongside the bill process will allow for any regulations necessary to be laid as soon as possible after the bill process is completed.
• Timescales will be shared with stakeholders as soon as possible.

Scottish Land and Estates

SLE stated that their priority is to protect and help the PRS to grow in Scotland.

They are concerned that the PRS in rural areas may be shrinking since the Cost of Living (Tenant Protection) (Scotland) Act 2022, as a result of the rural economy being more sensitive than the economy in urban areas. They are keen for the supply of PRS properties to be supported.

SLE also welcomed the upcoming expiry of the Cost of Living transition measures, as they consider this will provide a period of calm for the market to settle before any future changes from the Housing (Scotland) Bill.

They expressed concern about the provisions in the bill which allow local authorities to collect information from registered landlords, as in some cases, the owner of a property may not be the landlord of the tenancy in place.

They are also concerned about the types of property information which the bill allows local authorities to request from landlords, as they do not consider these are detailed enough to allow rents to be properly compared and regional nuance taken into account.

They consider that exemptions to rent control need to be in the primary legislation, even if this is only in the form of categories for which exemptions will be formulated, in order to give certainty to the sector.

They also expressed a concern about the duty to consider a delay to evictions, regarding whether PRS landlords have enough support in dealing with complex cases and whether the PRS is the right tenure to accommodate complex situations.

SLE consider that the bill needs to be rural-proofed and a rural impact assessment is required.

• The Minister recognises the importance of the PRS in rural areas, and agrees on the need for a thriving PRS.
• The issue of longer-term data on the PRS across Scotland is under consideration.
• The Minister reiterated the necessity of consulting on any exemptions in order to gather as many views as possible, in order to ensure that the bill is workable and legally robust.
• Where Group members have specific concerns about the bill, the Minister is keen to have their views on the best solution.
• He considers that it is important to work on bringing empty homes back into use (noting that there are a high number of these in the Highlands) and is keen to engage with the PRS about whether the sector can help with this.

Scottish Property Federation

SPF asked whether stage 3 of the bill was likely to take place before summer recess. They expressed concern that any delay to the bill process could mean a longer period of uncertainty for investors, which could affect investor confidence.

SPF agreed with the point raised by CAS regarding the initial timescales for tenants seeking rent adjudication.

They asked whether rent officers could be used as a focal point for data gathering, as Rent Service Scotland could have data on rent increases within tenancies from rent adjudication cases.

SPF echoed other members’ concern that local authorities may not have the resources to collect data, and proposed that rent officer data could support this.

• The Financial Memorandum which accompanied the bill considered resourcing for the measures in the bill, and SG is continuing to engage with local authorities around data.
• The Minister reiterated the importance of balance and looking at the situations in different areas.
• He is keen to give the sector certainty around the bill as soon as possible, and will continue to engage with stakeholders on this.

Scottish Land and Estates

SLE commented that consistency in the approach of local authorities is essential, as letting markets do not follow local authority boundaries.

UK Finance

UK Finance consider that the bill strikes the correct balance in many areas, but are concerned about the rent control measures and about, for example, how landlords who fall into mortgage arrears whilst offering below-market rent could resolve their situation under if rent controls were in force.

They are keen to ensure that there should be no need for divergence in factors for mortgage underwriting between Scotland and other parts of the UK.

They welcomed the fact that the Minister is working to ensure balance between investment and supporting vulnerable tenants.

• The Minister acknowledged the concerns raised, and will continue to discuss the issues with the Housing Investment Taskforce and with other stakeholders.
• He acknowledged the importance of striking a balance.
• He is keen for a wide range of stakeholders to respond to the consultation once this is launched, to ensure all situations are considered.

The Minister is keen to meet with the Group again, as well as to continue discussions with individual member organisations. He thanked Group members for the discussion.

Officials are also happy to meet with members to discuss the Bill further, particularly with respect to potential amendments sought by members.  

Actions

• SG to provide more information on the timeline for the spring 2025 consultation when dates have been confirmed.
• SG to update Members on ongoing work on data at a future meeting.
• Living Rent to share more information on concerns around NPF4 with officials.
• Members to contact officials or the Minister’s office if there are further things which they wish to discuss in relation to the topics covered in the course of the meeting.