When will the rent cap in Scotland finish?

CrGlo

There is currently a cap on increases to rent in Scotland, and I believe the cap is 3%. This was a temporary measure and was going to finish in Spring 2024 - I’m wondering please if this is still on track to finish then, or if there are plans to extend this rent cap?

_Penny_Dreadful

CrGlo said:

There is currently a cap on increases to rent in Scotland, and I believe the cap is 3%. This was a temporary measure and was going to finish in Spring 2024 - I’m wondering please if this is still on track to finish then, or if there are plans to extend this rent cap?

Whilst the nominal rent cap is set at 3% it is possible for landlords to increase the rent by 6% if they can demonstrate their prescribed property costs have increased sufficiently to warrant a 6% increase. 

The Cost of Living (Tenants) (Scotland) Act 2022 was due to end 31st March 2023 but the Act contains provision for it to be extended twice for a further 6 months. It has been extended once and it is looking very likely the Scottish government are going to extend it again. 

https://www.gov.scot/publications/cost-living-tenant-protection-scotland-act-2022-2nd-proposed-extension-statement-reasons/

ProDave

And they wonder why landlords are giving up and selling when they get a chance to (when their properties become vacant)

Sarah1Mitty2

ProDave said:

And they wonder why landlords are giving up and selling when they get a chance to (when their properties become vacant)

Just means more and cheaper supply for FTB (which is the aim of the SG I think)

_Penny_Dreadful

How does one poster (Sarah1Mitty2) manage to get it wrong in every single post?

Sarah1Mitty2

_Penny_Dreadful said:

How does one poster (Sarah1Mitty2) manage to get it wrong in every single post?

Are you saying that the eviction ban is also still in place and they can`t sell even if they want to?

_Penny_Dreadful

quod erat demonstrandum

[Deleted User]

3% cap, is there also a cap with landlord costs.

This is a sign to increase rents annually rather than be sentimental. 

CrGlo

Sarah1Mitty2 said:

ProDave said:

And they wonder why landlords are giving up and selling when they get a chance to (when their properties become vacant)

Just means more and cheaper supply for FTB (which is the aim of the SG I think)

I agree with the sentiment although it's not always black and white. For example, there are quite a lot of flats in high rises that cannot be sold under a mortgage just now due to cladding certificates and it is taking years to resolve this... in Scotland EWS1 certificates have now been scrapped as they await the roll out of the roll out of the new Single Building Assessment programme, but this is taking years to finalise. Developers have agreed to conduct these assessments and pay for remediation, but they don't know what the guidelines are yet so can't do it. Every building over 11m high needs this new certificate to sell, and are being gridlocked. There are many people who have rented out flats as they have been unable to sell them, that don't want to be landlords but had to move for one reason or another. The insurance charges have gone up by a lot, and now mortgage rates are going through the roof. I'd love if everyone who needs to sell, could actually sell, and that should bring an influx of properties to the market that have been gridlocked for quite a long time now, which would hopefully help FTBs.

SG rent caps are a good idea I think and may encourage small-time Buy To Let landlords to sell, but they need to actually be able to sell.. currently there are lots of people who can't and are waiting until the cladding situation is resolved in order to sell up. Nobody really considers the cladding stuff when I see comments about this stuff, and there are probably lots of other situations that fall through the cracks that I don't even know about... my own solicitor had no idea about these cladding issues. There's a big grey area for individual circumstances.

maladict

There's an article just posted about the impact of the rent cap in The National: https://www.thenational.scot/news/23731932.scottish-rent-cap-behind-growing-gap-prices-say-estate-agents/

Landlords are hiking rents whenever tenancies end to try to recoup 'lost' profits from capped rents from future tenants.  And nobody saw that coming.

Sarah1Mitty2

maladict said:

There's an article just posted about the impact of the rent cap in The National: https://www.thenational.scot/news/23731932.scottish-rent-cap-behind-growing-gap-prices-say-estate-agents/

Landlords are hiking rents whenever tenancies end to try to recoup 'lost' profits from capped rents from future tenants.  And nobody saw that coming.

It will all end in tears when the recession turns up, landlords who can`t pay their debt will just go bust and the house will go to a FTB or another landlord for a knock down price.