A property portal has taken the unusual step of warning politicians about the dire impact of rent controls on the private lettings sector.

Lettings portal CityLets, which operates chief in Scotland, has been measuring the impact of various degrees of rent controls exerted in Scotland over the past two years. 

Temporary legislation supplanted the expired emergency legislation at the end of Q1 2024 which provides for controls within tenancies and a rent rise cap of up to 12%.  

New rents on the open market continue to operate freely however proposals in the new Housing (Scotland) Bill now before parliament seek to introduce rent pressure zones in local, over-heated markets.

Commenting on this Gillian Semmler, PR Manager at Citylets, says: “Plans to extend controls in Scotland’s private rented sector will again have good intentions however these must be realistically and responsibly weighed up against the impact on rental supply.”

And Citylets managing director Thomas Ashdown comments: “Rents in the open market of the Scottish Private Rented Sector appear to be easing in many locations suggestive of a market now returning to better balance after what may transpire to be multiple but transitory market distortions set in motion by the pandemic. 

“Reported cessation of large scale projects, poised to add significant new supply of rental homes, would be rather unfortunate especially when it is wholly unclear as to where else they will come from.”

More generally the pressure on rents for new tenancies in Scotland’s private rented sector has started to ease with all major cities now reporting single digit annual growth. 

And Adrian Sangster of high profile Scottish agency Aberdein Considine adds: “In Scotland’s dynamic letting market, recent changes to rent cap rules have grabbed attention. While such regulations aim to balance tenant rights and landlord returns, demand continues to surge, eclipsing available supply. Despite this, a silver lining emerges for landlords, with stagnant property prices and escalating rents yielding attractive investment prospects. 

“Amidst this landscape, prudent landlords find themselves in a fortuitous position, as the market’s dynamics offer an opportune moment for acquisition. With rental yields on the rise, the Scottish letting market remains a compelling arena for landlords to navigate, presenting both challenges and promising returns in equal measure.”