Politicians blasted for ‘lack of balance’ in private rental sector policies

One of Scotland’s largest lettings agencies is voicing concern over what it calls “the lack of balance” in the Scottish government’s approach to private landlords. 

A complete moratorium on evictions has been extended to September 2023 meaning that landlords have very few options to obtain vacant possession of their properties including such circumstances as when tenants have stopped paying the rent or when the relationship between the tenant and the landlord has broken down. 

In addition, private sector rents cannot be raised until July at the earliest with notice having to be given this month - with any rent increases capped at three per cent. A rent freeze has already been in place since September 2022 until the end of last month.

Now Marsaili Macleod, lettings manager for Galbraith in Inverness, says the Scottish Government approach is out of kilter.

She comments: “Most buy to let investments are funded through borrowing, and landlords rely on the rental income to cover the cost of their mortgage repayments as well as to fund improvements to their property.

“Landlords typically make a significant investment in their rental property year on year to ensure it is properly maintained. We feel there is a distinct lack of balance currently and the Scottish government has not necessarily appreciated the benefits of a thriving private rental sector. 

“The government’s own research found that 94 per cent of tenants were ‘very’ or ‘fairly satisfied’ with their rental property, so why has there been such a degree of intervention in the market? Policy should be formulated in a way that allows proper protection for tenants without discouraging investment by existing landlords. 

“The current approach may well inhibit landlords from further investing in their rental properties and may well further exacerbate the current shortage of rental opportunities available, to the great detriment of tenants.” 

Galbraith reports that some landlords have sold their properties due to the increasing legislative burden, exacerbating the significant shortage of rental property available. 

However, despite the lack of support from the Scottish Government, landlords can take comfort from the fact that the demand from tenants for rental property continues to rise. Galbraith reports that the unusual shortage of available stock is causing frustration for tenants, as landlords can only choose one applicant out of often 20-50 applications for each rental property.

Macleod continues: “There are still many good reasons to be a landlord in Scotland. Tenants are almost always seeking a long-term tenancy, which provides continuity for the landlord. The demand for rental property continues to be far higher than the number of properties available. 

“This means that landlords can carefully select the right tenant for their property. As part of this process, we evaluate tenants based on a number of factors including their employment history, their ability to pay the rent and their recent lettings history.”

Galbraith lets over 600 properties per year across Scotland. The firm advises landlords on all aspects of lettings, from bringing a property to market, rental valuation, to securing and approving tenants,  management of compliance and legislative issues, property maintenance, repairs, inspections and inventories and  rent collection.

The Scottish Government's Scottish Household Survey 2020 showed that 94 per cent of households in the private rented sector were 'very or fairly satisfied' - that’s an indication, says Galbraith, that the private rental sector has delivered a positive relationship between landlords and tenants in the overwhelming majority of cases.