The Scottish government has been warned that the supply of homes for rent – particularly in rural Scotland – may be irreparably damaged by proposed new legislation.

Scottish Land & Estates, the Scottish Association of Landlords and NFU Scotland have penned a joint letter to the Scottish government urging it to change course when it comes to the PRS north of the border.

They fear that the tenancy proposals contained within the Coronavirus (Recovery and Reform) (Scotland) Bill could lead to thousands of homes being lost to the rental market.

The organisations have written to the Scottish Government ahead of a Stage 1 debate on the Bill in parliament on Thursday 12 May.

During the Covid-19 pandemic, all grounds for eviction of a tenant were temporarily made discretionary. This Bill seeks to make this change permanent and a tribunal would be asked to rule on a landlord’s desire to remove a tenant and reclaim vacant possession.

In effect, a tribunal will not have to automatically remove people, even where the tenant fails to comply with the conditions set out in their tenancy agreement, including non-payment of rent.

It would also be up to a tribunal to rule whether possession of a property could be regained in the case of a landlord wanting to live in the property, from a tenant who is no longer an employee or when the owner wishes to sell the property.

The proposed changes in law would have an impact on all types of landlords – whether they own a single property or multiple homes they let out and could lead to a substantial loss in the value of a property where a landlord could not regain vacant possession.

The organisations have raised concerns raised concerns that these far-reaching proposals are being introduced through the Coronavirus (Recovery and Reform) (Scotland) Bill rather than through a Housing Bill that would be subject to full parliamentary scrutiny.

The measures appear to go far beyond the public health rationale contained in other elements of the bill – and the issues trying to be solved are far from clearly defined. The Scottish Government recently published its Scottish Household Survey 2020 which showed that 94% of households in the PRS were very or fairly satisfied.

Added to this, rather than reduce burden on public services and reduce workload for the tribunal, this will make an already lengthy process even longer.

Open letter: 

Mr John Swinney MSP
Deputy First Minister and Cabinet Secretary for Covid Recovery
The Scottish Government
St Andrew’s House
Regent Road
Edinburgh EH1 3DG

Dear Deputy First Minister

Joint open letter: Part four, Coronavirus (Recovery & Reform) (Scotland) Bill

The Scottish Government’s plans to supposedly give housing tenants facing eviction greater protection is in grave danger of ruining the much–needed supply of homes for rent.

Instead of safeguarding the wider interests of tenants, what is more likely to happen is that a great many properties will be withdrawn from the market and sold at a time when there is a pressing need for rental homes.

At the height of the Covid–19 pandemic, there was a moratorium on evictions, except in special circumstances approved by a tribunal. Landlords understood this as a measure to deal with an unprecedented emergency. This Coronavirus (Recovery and Reform) Bill seeks to make this change permanent and a tribunal would be asked to rule on every instance where a landlord has legitimate reasons for ending a tenancy, including non–payment of rent.

For those landlords who want to sell their rental property perhaps to fund retirement or to free up capital to invest in other areas of businesses then not being able to end the tenancy will significantly reduce the value. Property professionals estimate that this could crush the value of a property by up to 50%.

Our organisations represent landlords of all types, from owners of single buy–to–let properties to people who run letting businesses in urban and rural areas. We cannot believe that the outcome sought by the government is a situation where tenants will find it harder to rent due to a reduction in supply and landlords face increased rent arrears or a substantial loss in the value of their properties.

We are also deeply concerned that such far–reaching proposals are being introduced through the Coronavirus (Recovery and Reform) (Scotland) Bill rather than through a Housing Bill that would be subject to full parliamentary scrutiny. The Scottish Parliament’s Local Government, Housing and Planning Committee agreed with the Scottish Government that it would be easier to make temporary powers permanent than wait for separate bill but this smacks of playing fast and loose with emergency legislation and there is widespread concern about the government’s desire to retain emergency powers that are not needed as normal times resume.

The government and committee’s suggestion that stopping these emergency measures would cause confusion is at best spurious and at worst deliberately dishonest. We believe that the Scottish Government is misusing Covid legislation to push through housing elements of the agreement between the SNP and Scottish Greens.

Given increasing interest rates and the cost–of–living crisis, the need for rental properties is essential and any measure that is detrimental to the provision of rental properties needs very careful consideration. The impact on the housing supply appears to have either been
dismissed or viewed as acceptable fallout to deliver the Minister Patrick Harvie’s continued attack on private landlords.

We urge Scottish Ministers to think again and take on board the genuine concerns of all those who not only own and let properties but tenants who need a place to live.

Yours sincerely

Sarah–Jane Laing
Chief Executive
Scottish Land & Estates

John Blackwood
Chief Executive
Scottish Association of
Landlords

Martin Kennedy
President
NFU Scotland