The Scottish government has passed emergency legislation designed to help tenants cope with the cost-of-living crisis. The Bill puts a cap on rent rises in the private and social sectors for at least the next six months and makes evictions unlawful in most cases for the same period.
Ministers say the Cost of Living (Tenant Protection) Bill balances the protections that tenants need with safeguards for those landlords who may also be impacted by the financial crisis.
Rent Freeze for Scottish tenants
Under the new law, rents for existing tenants cannot be increased for existing tenancies until at least the end of March 2023. The emergency legislation covers both private and social housing and can be extended for up to a further 12 months in two six-month blocks.
The rent cap can continue at the current 0% rate or can be varied at ministers’ discretion.
There is no cap or limit on increasing the rent when advertising for new tenants.
When is an eviction ban not a ban?
Despite the media attention when this was announced this is not a ban on landlords ending tenancies.
Landlords can still serve notice as normal if they wish to end a tenancy. Most tenants leave during the notice period when they find alternative accommodation so this restriction will have little effect here.
If the tenant doesn’t leave during the notice period, the landlord can apply to the tribunal for an eviction order as normal. However, the legislation delays a landlord from enforcing an eviction order issued by the tribunal in some circumstances for up to 6 months.
Tenants can still be evicted for anti-social behaviour, criminal behaviour, lender repossession, abandonment, substantial rent arrears (6 months +) or if the landlord intends to sell or move back in to alleviate financial hardship.
Increase In Damages For Unlawful Evictions
The new law has increased the damages that can be awarded for an unlawful eviction to a maximum of 36 months’ worth of rent.
Support For Landlords
There are safeguards too for private landlords who find themselves impacted by the cost-of-living crisis. They can apply to Rent Service Scotland to increase the rent on a property to cover up to 50% of a limited number of specific costs:
- Increased mortgage interest payments on the property they are letting
- An increase in any insurance that specifically applies to the property being let, such as landlords’ insurance, but not general buildings or property insurance
- Increases in service charges paid as part of a tenancy, subject to an overall limit
The application must apply to an increase that has occurred in the previous six months, and the rent on the property itself cannot increase by more than 3%. The existing limit on increasing rent only once in a 12-month period still applies.
Rent Cap Applies To Student Accommodation Too
The rent cap also applies to university halls of residence and other student accommodation where energy costs may be included in rent payments. To prevent landlords passing on gas and electricity cost rises, no rent increases can be made in the next six months unless the landlord can prove excessively high use of any utilities.
Students are also covered by the same eviction laws and can only be evicted in cases of anti-social or criminal behaviour.
Advice and guidance for landlords on the rent freeze and eviction ban
The Scottish government has launched a cost-of-living crisis website that offers helpful tips, advice and guidance.
As Edinburgh’s leading letting agent, our team at Clan Gordon can also help tenants and landlords who need advice in the current crisis. Schedule a call to speak to one of our expert advisors.
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