Scottish tenants have secured some vital protections with the passing of the emergency Cost of Living (Tenant Protection) (Scotland) Bill on 6 October 2022.
The new Bill introduces some rent controls and stronger tenants' rights on a temporary basis due to the cost of living crisis.
It introduces an initial six month "rent freeze" for all tenants in Scotland from 6 September 2022 - but it isn’t a complete freeze on rent increases (see below for prescribed property cost increases).
The "freeze" can be extended by six or twelve months - it will need to be continued to have meaning for tenants of councils and housing associations. Social rented sector rents are generally set in April each year - so the Bill will only assist such tenants if it runs to at least 30 September 2023.
Many private rented sector (PRS) tenants will see an immediate benefit. Their landlords are entitled in law to increase their rent once a year. Where a landlord has issued a rent-increase notice before 6 September 2022 that will still have effect, but otherwise rents are effectively frozen subject to some caveats.
The Bill allows a landlord to apply to the rent officer to recover 50% of "prescribed property costs". These are additional costs related to the house let: interest payable in respect of a mortgage; a premium payable for insurance (except building and contents insurance), and service charges that are paid for by the landlord.
Prescribed property posts can't exceed a 3% increase in the overall monthly rent. It may be the government allowed for smaller rent increases so that the Bill was more proportionate in law to see off any legal challenges in the Court of Session by private landlord associations.
It's important to remember the economic context. Earlier this year, the average PRS rent in Scotland increased by 8.5% in the last year, with average rents in Edinburgh rising by 14% and in Glasgow by 16%. Capping increases to 3% might not be perfect but it's progress.
The Bill has been described as introducing a "Winter eviction ban", but the reality is somewhat different. First, landlords can still raise court and tribunal proceedings against tenants.
The Bill's effect is to prevent the execution of an eviction order or decree. In other words, a landlord cannot instruct sheriff officers to evict a tenant and occupiers while the Bill is temporarily in force. Again, this comes with a series of caveats.
For PRS tenants, the eviction ban doesn't apply to these grounds: landlord's intent to sell property to alleviate financial hardship; property to be sold by lender; intent to live in property to alleviate financial hardship; tenant not occupying property; substantial rent arrears and several grounds on criminal and anti-social behaviour.
Substantial rent arrears for PRS tenants is defined as at least six months arrears.
For social rented sector tenants, a landlord can still evict for: rent arrears lawfully due of £2,250 or more; various grounds involving criminal or anti-social conduct; and where substantial works or demolition is necessary.
The Bill uprates the scale of damages for unlawful evictions - the court or tribunal will be able to award a sum up to 36 times the value of the monthly rent. Taking an average Glasgow PRS rent that could equate to almost £35,000.
This is a very good change in Scots law. Govan Law Centre are already seeing a Glasgow surge in threatened illegal evictions - with landlords wrongly thinking they can just change the locks.
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