Scotland’s Court of Session has come down in favour of the Scottish Government when it comes to rent controls.
A case against the Scottish Government’s controls had been raised by the Scottish Association of Landlords, Propertymark and the Scottish Land & Estates body.
Specifically, the three organisations wanted a Judicial Review in respect of the Cost of Living (Tenant Protection) (Scotland) Act 2022, in which the rent controls were contained.
But the decision has found in favour of the government, ruling that the legislation is not unlawful and does not breach landlords’ rights under the European Convention on Human Rights.
The crux of the judgement is that it is up to parliament, not the courts, to decide what situations justify ‘emergency legislation’ and to decide what a ‘proportionate response’ to that emergency is.
SAL says it is disappointed by the court decision but proud to stand up for and defend the rights of those providing homes in the private rented sector by challenging policy and legislation that is disproportionate and damaging to the sector.
A statement from SAL says: “Despite the court accepting our petition as having merit, and allowing the case to proceed, the outcome is nevertheless disappointing. However, by taking our fight to the Court of Session the government will hopefully think twice about introducing disproportionate legislation without consultation in the future. There is no doubt that this decision will further exacerbate the housing crisis in Scotland as more landlords will inevitably sell up, further reducing the number of homes to rent in Scotland.”
And Propertymark describes the news as “hugely detrimental to the Scottish private rental sector” and the decision confirmed by the courts now enables the Scottish Government to start implementing this “fundamentally flawed policy.”
Propertymark insists that the Scottish Government’s policy of rent controls has not resulted in any measurable benefits, and in fact rents continue to increase across Scotland, recording an overall 13.7 per cent annual rise as at Q3 2023, sending average rents within the region of £1115 per month.
Many landlords have expressed serious concerns they may be forced out of the sector entirely. However, the true extent of any exodus to date remains unknown until the next Scottish Housing Survey is published in full, having been scaled back since the onset of the Covid-19 pandemic.
Nathan Emerson, CEO at Propertymark, says: "The private rented sector is a crucial provider of housing and has been incredibly let down by a clear lack of understanding which is now driving good landlords away from the private rented sector. The economics of providing high quality homes is becoming alarmingly unviable.
"Private landlords currently commit to providing homes on a huge scale across Scotland and they must be assured that they can cover all costs. When developing policies that directly affect the private rented sector it’s vital that ministers fully understand the investment economics that sit behind the supply of high-quality homes to rent. Ministers must ensure housing policies include wide ranging impact assessments to ensure the system is fully workable for landlords, tenants, and agents alike.”
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