Edinburgh Rent Caps 1st Sep 2017

The City of Edinburgh Council has announced that it plans to apply for a city wide Rent Pressure Zone (RPZ) once the Private Residential Tenancy (PRT) regime comes into force (expected to be on 1st December).

 

The regime allows local authorities to apply to Scottish Ministers for areas to be designated as RPZs. Scottish Ministers must decide whether or not to regulate to introduce an RPZ within 18 weeks of the application being made.


If Scottish Ministers do decide to regulate, it is likely to be several more months before regulations come into force in Edinburgh, meaning that it is unlikely any RPZ would take effect until 2019 at the earliest.


Within an RPZ there is a cap placed on rent increases. To be clear, this cap would only apply to increases for new tenancies, i.e. those set up on or after 1 December 2017. The proposed RPZ cap will not be applicable to existing tenancies, i.e. those set up before 1 December 2017.


There is no restriction on the actual rental price for new PRT tenancies within an RPZ. The level of the cap on future increases is set by Scottish Ministers and must be at least 1% above the Consumer Prices Index (CPI). Rents can be increased every 12 months.


RPZs can be designated by Scottish Ministers only in extreme circumstances where there is evidence that rents are increasing by too much and in doing so are causing undue hardship to tenants and putting pressure on the local authority to provide housing or subsidise the cost of housing.

 

The Key Place will keep you informed of any future developments in this area.