Rent freeze in Scotland: what does this mean for landlords?

Drumsheugh Gardens, a row of terraced houses in Edinburgh new town.

The Scottish government is set to extend the temporary rent freeze for a further six months.

The emergency law came in last year to help people stuggling with the cost of living crisis, but was due to expire after 31 March.

Read on to find out more about what’s changed, what this means for landlords in Scotland, and if similar rules might be on the way for England and Wales.

New rules for landlords in Scotland

The Cost of Living (Protection of Tenants) (Scotland) Bill put in a number of measures to support tenants when it comes to rent and evictions in the private rental sector. This includes:

  • a temporary cap on rent increases
  • a temporary ban on evictions – similar to laws introduced during the coronavirus pandemic
  • increase to the damages which can be paid where a landlord carries out an unlawful eviction

How long is the rent freeze in Scotland?

Landlords have been unable to increase rents for existing tenants in Scotland since 6 September 2022. The initial rent-freeze period was until 31 March 2023, but it’s been announced that this will continue for an additional six months until September 2023.

The rent cap will rise from 1 April though – landlords will be able to increase in-tenancy rents by up to three per cent (rather than zero).

This will be reviewed regularly by ministers and could be extended.

Who does it apply to?

The rent cap applies to private residential tenancies, assured tenancies, and short assured tenancies in Scotland.

It doesn’t apply to:

  • new tenancies (as you can set the rent from the start of the new tenancy)
  • common law tenancies
  • regulated tenancies under the Rent (Scotland) Act 1984
  • some assured tenancies where the contract sets out rent increases

Can I increase rent in line with my costs?

The rent cap is set at 0 per cent until 31 March, meaning Scottish landlords can’t increase their rent during the rent freeze.

From 1 April 2023, landlords are able to increase rent by up to three per cent.

However there are some situations where you’ll be allowed to increase the rent if you can show that your property costs have increased.

You’ll need to apply to Rent Service Scotland to increase your rent by up to 50 per cent of the additional costs you’ve faced in the preceding six months.

Examples of property costs include:

  • mortgage interest payments
  • landlord insurance
  • service charges relating to your rental property that are contractually worked into tenants’ rent

Read more details on the legislation on the Scottish Government website.

Is a rent freeze likely to come in for the rest of the UK?

No change to the law has been announced for England, Wales, or Northern Ireland.

Any decision to bring in a rent freeze would be made by the devolved powers but there’s nothing on the cards at the moment.

There’s been plenty of discussion around the topic, from housing campaigners and ministers to letting agents, but only Scotland has implemented any changes.

London Mayor Sadiq Khan has previously called for an extension to notice periods for evictions and a two-year rent freeze.

The Energy Bill Support Scheme is one way the government is helping people in England through the cost of living crisis. A new law also means landlords are legally required to pass this £400 energy bill discount on to tenants with bills included in their contracts.

As always, keep an eye on the Knowledge centre for updates on legislation affecting landlords in the UK.

Are you a landlord in Scotland? How do you feel about the cap on rent increases? Let us know in the comments.

This article was originally written on 11 October 2022. It was updated on 19 January 2023 to cover the rent freeze extension.

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Catriona Smith

Catriona Smith is a content and marketing professional with 12 years’ experience across the financial services, higher education, and insurance sectors. She’s also a trained NCTJ Gold Standard journalist. As a Senior Copywriter at Simply Business, Catriona has in-depth knowledge of small business concerns and specialises in tax, marketing, and business operations. Catriona lives in the seaside city of Brighton where she’s also a freelance yoga teacher.

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