Scotland faces a housing disaster. Rents are ballooning, especially in Edinburgh and Glasgow; incomes are stagnant; and while its house prices would make a Londoner laugh (the average over Scotland as a whole is less than £200,000, and even in Edinburgh under £300,000), they are up by some 10 per cent since 2023. The Scottish government is determined to do something about it. Unfortunately, there is every reason to think that its remedies, straight out of the left-wing SNP rulebook, will make things rather worse.
The whole caboodle enriches builders, real estate developers and comfortably-off property owners. And the people it is meant to help, young workers needing a leg up? Hardly at all
Last year MSPs passed the Housing (Scotland) Act, which will eventually make permanent the system of emergency rent controls introduced after Covid. From next year on the government gets the power to declare ‘rent control areas,’ limiting any rises, even on a change of tenancy, to inflation plus 1 per cent, or 6 per cent, whichever is lower.
Well meaning? Certainly. But like most such measures, it is likely to be viciously counter-productive. With prices rising and rents capped, return on capital drops; and with it any incentive to buy homes for rental. If you already own a house on the private letting market, you are well advised to withdraw it, particularly since in the next few years (courtesy of further regulations from Holyrood) you may also have to pay large sums to satisfy energy efficiency standards which less than half the rented properties in Scotland currently reach. Thinking of building accommodation for rent? Forget it. Instead of constructing more homes for rental, which Scotland desperately needs, it’s far simpler, and more lucrative, to build a hideous block of student accommodation, which the country probably doesn’t need, but which has to reach far lower standards and is – whoopee! – free from the new rent controls.
