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Labour peer shows the damage rent controls can do to housing

A Labour peer who was to have invested £1 billion in affordable homes has halted his scheme because of the threat posed by a rent freeze.

Labour peer Lord Willie Haughey had plans to invest £1bn in 11,000 affordable homes to rent in Glasgow.

However, Scotland now has a mandatory rent freeze imposed by the Green Party - which is part of the Scottish Government - and this will last at least until April next year, with the option for it to continue until April 2024. It’s been promoted by Scottish housing minister and Green Party leader Patrick Harvie.


Lord Haughey has explained his move to halt the development for homes by saying: “Patrick Harvie’s rent freeze is a big part of my decision. The housing market is in absolute crisis and without any plans on how to address it that crisis can only get worse. Patrick Harvie will go down in history as the man who stopped investment and added to the calamitous lack of housing that we have in Scotland, 100 per cent.”

David Alexander, chief executive of lettings giant DJ Alexander, says: “Mr Harvie stated at the weekend that he had received messages from constituents who stated that they had experienced increases of 10, 20, and 30 per cent on rentals. Either Mr Harvie doesn’t understand the Scottish rental system, or he is being disingenuous. 

“All rent increases are subject to appeal and no tribunal in Scotland would ever approve increases of this scale so either the tribunals aren’t doing their job correctly or Mr Harvie needs to produce proof of such increases.”

“With tens of thousands of viewing requests coming into our system monthly, students being asked to sleep on the floors of common rooms, and waiting lists at record levels, demand has never been greater.”

Harvie has gone on record as saying that tenants will be protected by freezing rents; he insists that opponents of the freeze are “vested interests” like housing associations, agents, universities, construction companies, Build To Rent investors, and individual and corporate landlords. 

Alexander continues: “The problem is that supply has not kept up with demand and so we have the worst shortages in the rental market that anyone has ever seen. Mr Harvie believes that the private rental sector will not shrink as a result. 

“He stated that the vested interests always warn of this but don’t leave. He better hope that he is right because if he is wrong the number of tenants who will not be able to find homes is going to explode in the coming years.”

And he adds:“At a time when the Scottish Government is publishing a paper on economic growth after independence, they state that re-joining the EU and encouraging greater immigration will be a key pillar of their policy. Perhaps they should check on where they will house these EU workers (prior to the pandemic 40 per cent of all private rental sector tenants in Scotland were from outside the UK). If the private rented sector continues to shrink, there will be no homes for these workers and economic growth in Scotland will be even harder to achieve.”

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  • icon

    Scottish Govt reaping what it sows at the expense of the people it purports to serve.

  • icon

    Harvey is claiming that Scottish Landlords can get permission to increase rents by 3% or up to 50% of any increase in costs if less.

    Some idiot SNP supporters think this means Landlords are protected from a 3% increase in mortgage rates from say 2% to 5%, whereas only an increase from 2% to 2.12% would allow a rental increase of half of that and no further increases would be allowed for at least 12 months.

    Every Scottish tenant can expect maximum possible rent increases as often as possible once the penny drops on the harm being done to PRS supply, but I won't hold my breath!

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    Well it needs to be a lot more than 3% next year. If interest rates go up by 1% then that's £100 extra interest on £100,000 interest only loan. Which is a lot more than 3% of the rent. If the rent was say £600 then £100 increase in costs is 17%. And if the interest rate goes up say 3% then that's £300 extra interest per month, which would be 50%.


    I agree - not sure if Comrade Harvey is clever enough to understand that too but hates landlords so strongly he doesn't care, or if he's too stupid to understand it.

    I think it's a combination - he's stupid but doesn't care anyway.

  • PossessionFriendUK PossessionFriend

    That's how myopic the Rent Control campaigners are.

    They haven't a clue how business works and all their campaigning hurts the Tenants more and more.

    Tenants need to be a bit smarter and see through the campaigning charades.


    I have one property with a rent control, a protected tenancy going back to 1958, I'm allowed to increase the rent every 2 yrs, so I do, to the full amount that I can, I've just put in for a 10% increase, after all that's where inflation is at present, so if rent controls come in we will all have to be increasing all rents to the full rate of inflation as often as allowed.

  • George Dawes

    Yeah but no but yeah but no at the end of the day at the end of the day where's me sky tv and fags at the end of the day yeah but no yeah but no rent freeze yeah but no evil landlords yeah but no yeah but no at the end of the day


    Very succinctly put George!

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    If this stands then Scotland will be a PRS wasteland.


    The Rent Freeze and Eviction Ban legislation is already the Law, backdated to early September, and there are around 900 groups of students currently chasing a single flat!

    Currently there is no ban on increasing rents before a new tenancy starts and with groups of students who share needing a new tenancy agreement every time there's a change in the group, most student rents will go up every year - but the chances of a couple or family finding a long term prs property are now miniscule - and the new rents will be eye watering - the exact opposite of what the SNP claimed the rent freeze and earlier December 2017 PRS legislation (banning mutually agreed fixed term tenancies) was designed to achieve!

    There is so much demand for PRS properties in Scotland that my grown-up kids are continuing to buy them - but only for letting to students with several solvent guarantors.

    Couples and families have been hung out to dry to satisfy the deep red dogma of the SNP and their little Green helpers.

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    It always amazes me how dim some of the ministers are. They can only see very short term. They can't consider the impact there policies will have on the long term PRS. We need smarter ministers.


    Ministers are only interested short term because they are only in their jobs short term, when labour are elected at the next GE Starmer will be out and replaced with someone hard left within the year, what do they care

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    Dim or purely self interested? - career before country I think with a bit of bigoted thrown in for good measure.


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