Changes to Private Renting | Scotland

Changes to Private Renting | Scotland

More headaches for landlords!

Wide ranging changes from new legislation in Scotland come into effect in December 2017. The new legislation is the toughest yet in terms of tipping the scales in favour of tenants and away from landlords. The changes to private renting in Scotland may drive landlords away.

What exactly is happening?

Tenancy Agreements

These will no longer be Assured Shorthold Tenancy Agreements that are fixed term, permitting landlords to end tenancies (subject to notice) at the end of an agreement. The new agreement called Scottish Private Residential Tenancy Agreement will allow tenants to stay for as long as they wish but enable them to give 28 days notice to the landlord at any time – even if they have only been in the property for a short time.

Rent Increases

Changes to the way landlords can increase rent include:

Landlords have to give 3 months written notice using the correct form in order to increase rent

Rent can only be increased once every 12 months

Tenant can refer proposed increase to a rent officer for approval if they don’t agree with the increase. The rent officer then acts as an adjudicator

Councils can apply to have an area turned into a rent pressure zone to stop rents increasing too fast and cap rents if approved

In order for landlords to repossess their property they will have to meet one of 18 grounds for repossession set out by the new legislation.

18 Grounds for repossession

In order to prevent landlords from using any of these grounds to evict tenants and then go back on the reason, safeguards are included that allow tenants to move back in if the landlord does so.

The grounds for repossession are as follows:

  1. Intend to sell – 84 days notice and evidence of selling
  2. Property to be sold by lender – repossession
  3. Major refurbishment – evidence required
  4. Landlord intends to live in property – evidence required
  5. Change of use of property – evidence required
  6. Let to religious worker but only if used for this purpose previously
  7. Tenant using the property for criminal activities or committed a crime in or near property
  8. Tenant not occupying property
  9. Family member needs to live in property
  10. Tenant doesn’t need supported accommodation if they moved in for this reason
  11. Tenant has breached contract (not rent arrears)
  12. Tenant engaged in antisocial behaviour
  13. Someone living in the property who is criminal or antisocial
  14. Landlord’s registration revoked
  15. Landlord’s HMO license revoked
  16. Statutory notice of overcrowding served to Landlord
  17. Tenant has rent arrears for three or more consecutive months
  18. Tenant stops being employee if rented on these grounds initially

More information can be found on the Scottish Government website.

Potential Impact

changes to private renting ScotlandLandlords in Scotland may decide that these changes take away too many of their rights and could choose to exit the market. Pressure groups that work on behalf of the homeless and tenants may try to lobby Parliament in other parts of the United Kingdom to bring in similar changes.

Landlords in England, Wales and Northern Ireland need to watch closely as similar legislation may be introduced.

Conclusion

Whilst changes to private renting | Scotland may seek to protect tenants, they could drive an even deeper wedge between those that legislate and those honest landlords who invest in buy to let property.

Watch this space!