Mortgages.scot

The rent cap in Scotland was introduced in September 2022. From the 1st of April 2023, the cap on rent increases is 3%. This was introduced to help tenants during the cost of living crisis. An extension to the cap was agreed in September 2023 which lasts until 31 March 2024. Just a couple of months away.

The cap can't be left in place forever so this is expected to be the end of it when March 31 comes around. To transition away from it the Scottish government is suggesting temporary changes to rent adjudication as part of the transition.

Information from Propertymark, a professional body in the property sector the following is being suggested.

For the most part, rent increases landlords chose to apply will be able to go ahead as normal.

One area that the Scottish Government is looking at changing temporarily is how rent increases that are referred to adjudication are treated. Tenants who believe a rent increase is unreasonable can appeal to the first-tier tribunal for Scotland to decide on a reasonable market rent for a property.

Under the proposed transition the Scottish government intends to make changes to the rent adjudication process. The decision will be based on the lowest of the following;

• Open market rent
• The rent proposed by the landlord
• A maximum reasonable increase for the tenancy, based on a taper calculation.

In the last option, the taper would be a percentage applied where the increase proposed by the landlord was considered unreasonable. The calculation will likely be based on the difference between the current rent and the open market value of other, similar properties and tenancies. It's also likely an upper limit will be proposed on the maximum percentage increase.

None of this is set in stone so it may change, more will announced as discussions continue.