Scottish Rent Pressure Zones (RPZs) have proved so ineffectual that no council has been able to meet the stringent tests giving them the ability to cap rents, according to new research.

Councils currently need to apply to the Scottish Government, proving that rents are rising too fast, that those rises are causing problems for tenants, and that they put pressure on the council to provide housing.

However, the Progressive Policy Research Group says it can take local authorities up to five years just to collate the evidence. “As a result, the pressure that the private rented sector puts on family finances, and the impact it has on child poverty rates, go unmitigated,” it says.

New proposals

It’s come up with new proposals for reforming the sector, suggesting that these zones should apply to individual properties instead of tenancies as a way to incentive landlords to upgrade their properties and to stop them significantly increasing rent when a tenancy ends.

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The group says the current system can disincentivise tenants moving, and in worst case scenarios can encourage eviction.

The research group wants the government to devolve responsibility for RPZs to local government and suggests that the Scottish Landlord Register is upgraded to include:

  • HMO licence,
  • Confirmation of using an approved tenancy deposit scheme,
  • Energy Performance Certificate,
  • Details on lengths of tenancy and rent levels,
  • Verification that all appropriate tax has been paid and deposit information.

It explains: “This upgraded register should become the central data resource of a significantly more powerful and resourced regulatory body, whose purpose will be to ensure that landlords are complying with the law, and to drive up standards in the PRS.”

The Scottish Government is currently consulting on the Fair Rents (Scotland) Bill which would cap rent rises at 1% above inflation and give renters protection against excessive or unfair rent increases.

2 COMMENTS

  1. In any business sector, increased regulatory compliance tends to favour larger companies. Warren Buffett refers to them as “Barriers to Entry” or “Economic Moats”.

    It’s one reason I like large tobacco and defence companies. Quite difficult for new start ups to challenge them. Also known as “Crony Capitalism”.

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