SPF reaction to the Scottish Housing Bill

Commenting on the Scottish Housing Bill published today, SPF Director David Melhuish said:

“The Housing Bill published today comes just 24 hours after the Scottish Government released statistics showing a significant fall in new home starts across all tenures. Every effort must be made to address the supply crisis in Scotland by building more homes of all tenures. There is no solution to the housing crisis that does not involve greatly increasing the supply of new homes across for sale and rent.

“This Bill will be a disappointment to those seeking to build new rental homes in Scotland. Investors in the new, modern Build-to-Rent sector - which brings high standards of property management and offers greater flexibility to tenants, in line with many of the Government’s objectives - will remain uncertain of what the future rent control system will look like until potentially late 2026.

“Investors will also be greatly concerned to see rent controls extended to properties that go back onto the market after a sitting tenant has left. This could make it harder for property owners to fund major improvements, including energy efficiency measures, to their properties between tenancies.

“Should the legislation be approved by the Scottish Parliament unamended, we risk repeating the damaging effects of the emergency rent freeze legislation passed in 2022 when investment for Scottish rental housing was frozen, deterred, or diverted to projects outside of Scotland. We estimate that there is currently between £2.5bn and £3bn of investment now at risk that could deliver quality new homes for rent in Scotland.

“Our industry and members remain committed to supporting new investment into the sector and will engage with the scrutiny process of the Bill as it progresses through the Scottish Parliament.”