Private Housing (Tenancies) Bill 1st Feb 2016
The Private Housing (Tenancies) (Scotland) Bill aims to protect tenants from the prospect of unfair eviction, and rent increases. It is claimed that the Bill will ‘provide security and stability to tenants while ensuring the sector is attractive to landlords and investors’.
Proposals in the Bill include:
• Improve security for tenants, which means that they cannot be asked to leave their home simply because the tenancy agreement has reached its end date.
• Comprehensive and robust repossession grounds which will enable a landlord to regain possession of their property in reasonable circumstances.
• The opportunity for local authorities to implement rent caps in areas where there are excessive increases.
• A more streamlined system with no confusing pre-tenancy notices and easier-to-understand model tenancy agreement.
In January 2016, the Bill went through a Stage 1 hearing in Parliament, and a report giving recommendations was agreed.
In summary, MSP’s agreed to the ‘general principles’ behind the Bill. Housing minister Margaret Burgess, who opened the debate, said there is an increased need of housing supply and the government is committed to that, but that the Private Housing Bill is “about security for people in the private sector and about rebalancing the relationship between tenants and landlords.”
However there are concerns regarding parts of the Bill, specifically in relation to the removal of the no fault ground for repossession. This will mean that landlords will have to provide and prove one or more of 16 reasons (listed in the Bill) before they will be able to end a tenancy. This process will involve the First Tier Tribunal, a committee which will preside over evictions. Their aim is to ensure tenants have a proper tenancy agreement as well as hearing complaints about unfair evictions. Overall, it is going to become more difficult for landlords to regain possession of their property, however in the debate it was acknowledged that the 16 new grounds must provide an appropriate and proportionate balance between tenants and landlords.
Clearly there will be a huge impact on the student sector and holiday let sector, as landlords will be unable to run tenancies on the usual 10 month, student year basis. Many landlords rent on a short term holiday let basis over July and August, then re-let to students in September. This will be more difficult and risky under the new proposals as there is no way to guarantee that the students will leave at the end of June to allow this to happen. The committee is currently reviewing the Bill in relation to this particular sector.
There is further concern over the introduction of rent caps, as it has been observed that rents have stabilised throughout Scotland, as you would expect in a free market economy. Lib Dem MSP Jim Hume warned introducing rent controls could actually see an increase in rent costs. The Committee set up to look at the Bill are asking the Scottish Government for more information on why they consider the rent cap proposal necessary when they are trying to increase supply in the market.
A number of campaign groups were set up to lobby parliament regarding contentious issues included in the Bill. The Key Place continues to be active within these groups. The groups have been listened to, and a number of recommendations have been made to improve the Bill. Suggested amendments will be debated and voted on by MSPs in two further stages until a final vote is taken on the content of the Bill, probably in March. It is unlikely that the new tenancy regime proposed in the bill will be implemented before early 2018.