Strategy to safeguard the PRS
The Bill contains a package of reforms to help ensure people have a safe, secure, and affordable place to live. It also helps to deliver the Scottish Government’s ‘New Deal for Tenants’ and some aspects of ‘Housing to 2040’, while contributing to the ambition to end homelessness in Scotland.
Propertymark believes the Bill must be significantly amended before the Scottish Government’s policy can be achieved. We, along with other stakeholders gave evidence to the Local Government, Housing and Planning Committee urging the Scottish Government to better understand the PRS and review costs and taxes impacting private landlords.
Summary of the assessment
Supporting those on lower incomes
The Scottish Government recognise that the rented sector houses a diverse group of people; understanding the needs and experiences of tenants is crucial in helping deliver their policy aims.
Through poverty and wealth analysis research, The Scottish Government feels the experience of affordability within the private rented sector is likely to be very different for more deprived and less deprived tenants. Also, they state that ‘rented households are more likely to have lower incomes and be financially vulnerable than those in other tenures’ with most paying more of their income on housing costs than owner-occupiers. The assessment also states households in the rented sector are also more likely to be financially vulnerable and have less resilience to cope with financial shocks.
Based on their sweeping analysis of renters, and, as they state, the limited available evidence that does not suggest that private rented sector landlords themselves are like to be in deprivation, the assessment is quite one-sided.
Rent controls
The Scottish Government will continue to engage with the sector to design the details of how rent control will be implemented, and it is anticipated that there will be safeguards for landlords included in the policy design, to enable landlords and other investors to feel confident to remain in the sector.
Capping of rent increases
These measures may be particularly beneficial for tenants on lower incomes as evidence suggests those who reported having less confidence to raise a dispute with their landlord tended to be those with less financial power, those on lower incomes, in part-time work, or younger, inexperienced renters.
Evictions
Evidence suggests that those on lower incomes may be more likely to be at risk of being unlawfully evicted. The measures in the Bill will help to make it easier and more attractive for tenants to challenge an unlawful eviction and receive compensation where an unlawful eviction is found to have occurred.
Tenant rights to decorate and keep pets
Keeping a pet or making changes in a private tenancy suggests there may be some positive impact on the tenant's mental health and well-being. And whilst no landlord is disputing the evidence, the Bill needs to reassure landlords they can return their property to its original condition when vacated, which is why a larger deposit or insurance protection could be required. However, the assessment states that suggested evidence that these additional barriers and costs associated were not evenly distributed, with low-income households among the groups identified as being most severely impacted if a supplementary deposit is mandatory.
Ending joint tenancies
This has always been seen as positive with this provision benefitting tenants, especially victims of domestic abuse, as the current law can lead to tenancies being used as a means of financial control. Measures create a process by which a joint tenant can bring the tenancy to an end. Where a joint tenant needs to make use of the new process, their future liabilities for the tenancy would be limited to approximately 3 months (the new 2-month pre-notice period, plus the standard 28-day notice period).
Homelessness prevention
It is positive to see helping those vulnerable will be identified upstream and supported, which is the key to the introduction of the new homelessness prevention duties.
Unfortunately, the Fairer Scotland Duty Assessment summary for the Housing (Scotland) Bill identifies significant shortcomings in the Scottish Government’s approach to engage with the sector.
While we recognise the Scottish Government’s term policy is to ensure a fairer private rented sector, it is disappointing and somewhat surprising to see that the sector’s overwhelming criticism of rent controls has been ignored, especially considering the substantial engagement Propertymark and the wider sector has had with MSP and Scottish Government officials.
At a time when the PRS faces considerable pressures and Scotland faces rising homelessness levels, the Scottish Government must listen to the sector to prevent a further reduction in the availability of private rented homes for tenants.
