More clarity needed on government plans for rent controls, MSP committee says

A majority of MSPs on a Holyrood committee have backed government plans for rent controls, but said further clarity is needed.

However two Conservative members of the Housing Committee dissented from the group’s report and declined to back the general principles of the government’s Housing Bill.

The legislation was lodged earlier this year, allowing ministers to create rent control zones following a recommendation from local councils.

Within these areas, prices in the private rented sector will not be allowed to rise higher than 1% above the rate of inflation as measured by the Consumer Prices Index (CPI), up to a maximum of 6%.

Releasing a report on the Bill, the committee said there is uncertainty around how the law would operate in practice which could impact investment in the sector.

Those supporting the Bill recognised that “it is not in itself the answer to the housing emergency”.

Committee convener Ariane Burgess said: “We are currently in the midst of a housing emergency and this Bill is an important part of the solution to address that by redressing the imbalance in the relationship between tenants and landlords.

“For rent controls to be effective, however, there is a need for certainty for both tenants and landlords about measures within the Bill and how the proposals will work.

“It’s disappointing that it was only last week that the Housing Minister made an announcement about how rent controls might work.

“The Bill before us does not provide detail on many aspects of how the legislation will operate, and with consultation on some aspects of the Bill continuing until 2025, there will be little room for parliamentary scrutiny in an area which is critical to get right for the long-term sustainability of the private rental sector.”

She said robust data collection on rent levels is needed for the Bill to be a success, calling for a national approach to collect accurate figures.

The two dissenting members of the seven-person committee were Meghan Gallagher and Alexander Stewart.

Housing Secretary Paul McLennan said: “The Housing (Scotland) Bill will support people to stay in their homes and provide earlier intervention to prevent homelessness.

“We want to see a private rented sector that works for tenants and responsible landlords and recognises the benefit of investment in rented housing.

“Our proposals for a long-term rent control will provide greater certainty around costs for private tenants in areas where rent control applies, whilst reflecting the needs of landlords, investors and developers.”