Boosting housing supply, not rent caps, key to tackling Scotland’s rural housing crisis

Press Release

Increasing housing availability – rather than an ill-advised narrow focus on affordability – is key to solving Scotland’s rural housing crisis.

Scottish Land & Estates, the rural business organisation, commented after giving evidence to the Scottish Parliament’s Local Government, Housing and Planning Committee on the Housing (Scotland) Bill today.

The Bill is currently at Stage 2 in the parliamentary process, and SLE has expressed significant concerns that the legislation fails to encourage investment in new housing stock.

In November, the Scottish Government announced that the proposed rent cap set out in the Bill would be set at CPI plus 1%, up to a maximum increase of 6%.

Cameron Gillies, Public Affairs Manager at Scottish Land & Estates, gave evidence to the committee.

Mr Gillies said: “The legislation as it stands does little to address the cause of the rural housing crisis in Scotland.

“By focusing on the symptoms of high rents rather than the cause – a lack of supply – the government is taking the wrong approach.

“Recent figures from the Landlord Register reveal a decrease in private rented sector (PRS) properties in rural Scotland, including a 7.5% drop in the Highland region and a 4.5% decline in Dumfries & Galloway. This trend, supported by anecdotal reports from SLE members, emphasises the pressing need for policies that encourage housing supply and make it easier to build new homes rather than deter investment as this Bill risks doing.”

SLE also said that although the proposed adjustment of the rent cap in rent control areas was a welcome move, there was still a need for the Scottish Government to examine fair exemptions on rent controls for rural housing providers.

Cameron added: “Maintenance costs for landlords in rural areas are generally higher than they are in urban areas, whilst rental income is usually lower.

“The Scottish Government is seeking significant investment in private rented property, particularly when it comes to meeting tough energy efficiency standards.

“We understand and agree with the desire to improve housing stock but there needs to be the ability for a landlord to recover the cost of investment. These costs are higher in rural areas, where many homes are off-grid, and exemptions from the rent cap are a common-sense route to allowing that expenditure to be recovered.”