The Scottish Parliament has extended Scotland’s rent increase cap and eviction restrictions for another six months – but with some important differences to the previous period.
From 1 April, private landlords will be allowed to increase rent by up to 3% mid-tenancy, up from 0% previously. They will also be allowed to apply to Rent Service Scotland (RSS) for an increase of up to 6% to partially cover the increase in specific costs, which are:
- Mortgage interest on the rented property
- Service charges on the property charged to the tenant as part of their rent, if this is set out in the tenancy agreement
- Insurance premiums directly related to offering the property for rent, including landlord insurance but not building or property insurance
Any landlord applying to RSS for a rent increase over 3% must also inform their tenant in writing, setting out the current rent, the proposed increase, information about their increased costs and a statement that the rent will not increase unless approved by RSS. The rent increase can also not be applied until at least three months after the application date, even if RSS approves it sooner – leaving the landlord to cover 100% of their increased costs in the meantime.
The caps only apply to rent increases within tenancies. Landlords advertising for new tenants can set whatever price they like. But enforcement of evictions has also been suspended except in specific circumstances, including substantial arrears, criminal or antisocial behaviour, or needing to sell the property to avoid financial hardship.
What else has changed?
The rules are different outside the private rented sector. Social housing providers will no longer have a cap set on rent increases, but have been asked by the Scottish government to keep them below inflation. Planned increases for 2023/24 are an average of 6.1%.
Student housing providers will also now be able to set unlimited rent increases. Research by the government found that the cap was having little effect on student rents as most students only stay for a single academic year – not long enough for a rent increase.
Under the terms of the Cost of Living (Tenant Protection) Act, the government can make one final six-month extension after this one runs out at the end of September. If they go ahead with that, they could also adjust the cap on rent increases again.
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