Scotland’s housing crisis: ‘Anti-landlord legislation’ deters developers

Scotland’s housing sector is in crisis as developers are being deterred by what they term as ‘anti-landlord legislation’ and are opting to build in England instead, The Times reports.

The shift could result in Scotland missing out on the construction of thousands of new homes.

Jonathon Ivory, the chief investment officer at Packaged Living, told the Times that the company has no plans to invest in Scotland due to the ongoing anti-landlord legislation.

He said: “We aren’t investing in Scotland right now due to the continued presence of anti-landlord legislation.”

Declared Scotland as a no-go zone for investment

The newspaper says industry insiders have identified nine other developers that have declared Scotland as a no-go zone for investment.

Scotland’s housing sector has become depressed due to a combination of the new Housing Bill, cladding legislation and the proposal for new rent caps.

The depression affects not only new builds, but also the availability of existing stock for rent.

The Chartered Institute of Housing declared a housing emergency across Scotland last month, warning that the Scottish government’s homelessness plans were at risk without a strategy for the private rented sector.

Several cities and councils, including Edinburgh, Argyll and Bute, and Glasgow, have declared emergencies.

Edinburgh has lost thousands of homes to short-term let businesses, and rents have risen faster than anywhere else in Scotland.

Meanwhile, housing developers continue to focus on purpose-built student accommodation (PBSA) over affordable homes.

Shortfall of more than 100,000 homes on the market

The chief executive of Homes for Scotland, Jane Wood, highlights a shortfall of more than 100,000 homes on the market.

And she criticises the new Housing Bill for failing to address the fundamental issue of chronic undersupply and accused the Scottish government’s policies of hampering new homes coming onto the market.

Ms Wood said: “Rather than using the same tired response blaming Westminster, Brexit and cost price inflation, the Scottish government must pull the levers that it has at its disposal to encourage and facilitate home building rather than frustrating and delaying it.”

Rent cap imposed by Nicola Sturgeon’s government

The rent cap was initially imposed by Nicola Sturgeon’s government to help with the cost-of-living pressures, and it ended on April 1.

Transitional arrangements are still in place, allowing landlords to attempt to raise prices, although tenants can challenge any increases through an adjudication process.

However, campaigners for tenants, landlords and developers have criticised these arrangements as unworkable and ill thought-out.

Some landlords, the Daily Telegraph reported last week, have reportedly been increasing rents by up to 12% during this process.

Proposals for rent control areas

Patrick Harvie, the co-leader of the Scottish Greens and the tenants’ rights minister, recently published a new Housing Bill which brings forward proposals for rent control areas.

However, this is unlikely to make its way through Holyrood until next year.

Mr Harvie has previously stated that a fairer, well-managed private rented sector is in the interest of both tenants and responsible landlords.

He has also said that European countries have shown that ‘rent control can be compatible with ongoing investment’ in the sector.

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