After sale shared equity procedures: guidance

8. Grant of tenancy

Shared equity owners are no longer permitted to let their property under any circumstances. Previously permission to let was given for limited periods in exceptional circumstances. However, following short assured tenancies being replaced by the private residential tenancy ("PRT") in terms of the Private Housing (Tenancies) (Scotland) Act 2016, landlords are no longer able to provide for the tenancy to run for a limited period of time, since a key aspect of PRTs is that, once created, they continue without limit of time and landlords can only recover vacant possession if either (a) the tenant gives notice of their intention to leave or (b) certain grounds exist which justify an eviction order. This means that letting for short periods is not compatible with the new legislation, and so Scottish Ministers have decided that they will no longer grant any further permission to let.

Where previous permission to let was granted, and has now come to an end, no further permission to let will be granted. Copy correspondence to be sent to owners and their agents in relation to this is set out in Annex 5.

If it is found that a shared equity owner is letting their property, the owner should be contacted by the RSL and informed that they are in breach of their Shared Equity Agreement and the RSL should contact Scottish Government to recommend that Scottish Ministers' solicitors are instructed to take enforcement action. At the same time, the RSL should confirm to the owner other options which are open to them such as selling the property or increasing the equity stake to discharge the Scottish Ministers security.