Examining Scotland's New Housing Bill Legislation

The new housing bill legislation comprises of six main parts, each addressing different aspects of the housing crisis in Scotland.

Part 1 of the bill focuses on private residential tenancies, proposing measures to regulate rent conditions and prevent unjustified rent increases. It mandates local authorities to periodically assess rent conditions in their areas (at least once in every 5 years) and grants Scottish Ministers the power to designate rent control areas and impose limits on rent increases. Another key aspect includes restrictions on rent increases at the start of a tenancy within designated rent control areas. The legislation also imposes limits on how often rent can increase during a tenancy, both within and outside rent control areas.

Part 2 of the bill addresses legal proceedings concerning tenants' rights, requiring the First-tier Tribunal for Scotland and the courts to consider delays in eviction orders for both private and social housing tenants. It also changes how damages for unlawful eviction are calculated.

Part 3 introduces new rights for tenants, including the ability for private and social housing tenants to request permission to keep pets and make alterations to rented properties.

Part 4 encompasses various changes affecting tenants, such as reallocating unclaimed deposits to Scottish Ministers to a fund to support private tenants and granting Scottish Ministers the authority to convert assured tenancies into private residential tenancies. Additionally, there is provision to allow for a single joint tenant to terminate a joint tenancy. This change marks a significant departure from traditional tenancy arrangements, where all joint tenants typically must agree to terminate the tenancy collectively.

Part 5 of the bill focuses on homelessness prevention, requiring relevant bodies (health boards, police, local authorities) to identify individuals at risk of homelessness and take proactive measures to intervene and prevent homelessness. Additionally, social landlords will be mandated to provide support to tenants experiencing rent arrears or risk of homelessness due to domestic abuse, highlighting efforts to safeguard vulnerable populations.

Finally, Part 6 addresses miscellaneous housing matters, including reforms to mobile home pitch fee calculations to follow the Consumer Prices Index (CPI) rather than the Retail Prices Index (RPI) and adjustments to fuel poverty reporting and consultation requirements.

Much of the detail of the Bill is still being scrutinised. Dr John Boyle, Director of Research & Strategy at Rettie provided initial thoughts.

The new Bill, unless it undergoes significant amendments, is unlikely to provide any substantial assistance in solving the housing crisis in Scotland, which is predominantly one of supply and availability.

Enhancing tenants’ rights is a laudable objective and there will be parts of the Bill that will be widely supported, but the imposition of rent controls within and between tenancies may make the private rental sector un-investable for some, not just the small landlords who provide that vast majority of private rental housing stock in Scotland, but the large investors (including pension funds) that want to invest in Scotland but cannot do so in a climate of uncertainty and inability to guarantee index linked returns. In short, by squeezing supply yet further, the Bill in its current form will worsen the housing crisis.

As the Bill progresses through Parliament, stakeholders will have the opportunity to provide input and shape its final form. Rettie, a key player in Scotland's housing sector, is actively engaging with clients and stakeholders to navigate the complexities of this legislation and its potential implications.