Anyone who lets out a residential property to tenants, or plans to do so, should be aware that new legislation is on its way. The time of arrival is as yet unknown but is expected to be late 2017 or early 2018.
The new legislation (Private Housing (Tenancies) (Scotland) Act 2016) will make major changes to renting and letting residential property in Scotland.
Under the current system, landlords let property under ‘assured tenancies’ or ‘short assured tenancies’. The new legislation will replace these with the Scottish Private Residential Tenancy, or SPRT.
The government’s intention in introducing the SPRT is to create greater stability in the private rented housing market. Changes for landlords will include simplified rules for giving tenants notice.
Less welcome to landlords will be tenants having greater security of tenure under the new system.
Currently if you let a flat for six months or more, you know you can get it back on the “no fault” ground, assuming your paperwork is completed and delivered properly. With the new SPRT, landlords will no longer have this automatic right to repossess the property. Instead they will need to show grounds for repossession, such as selling the property, a family member wanting to live there, rent arrears or anti-social behaviour. The law on this is not straight forward and advice should be sought.
Once the new legislation takes effect, no short assured tenancies can be created.
RENT INCREASES AND RENT PRESSURE ZONES
The new legislation will introduce restrictions on a landlord’s ability to increase the rent. A landlord wishing to increase the rent must give the tenant at least 3 months’ notice by way of a rent increase notice. Rent can only be increased once per year.
Local authorities can apply to the Scottish Ministers for areas to be designated as rent pressure zones. This will put restrictions on the amount by which rent can be increased for properties within a zone. For properties not in these zones, tenants will be able to refer a rent increase notice to a rent officer for determination.
Although no arrival date for the SPRT has yet been fixed, it could come into force as early as December 2017. We strongly recommend watching out for its advent, and getting advice about how its introduction will affect you and what you need to do.