Extension of The Cost of Living (Tenant Protection) Act 2022

The Scottish Government recently announced its plans to extend the effect of the provisions of the Cost of Living (Tenant Protection) (Scotland) Act 2022 beyond 31^st March 2023 until 30^th September 2023 (subject to further approval).

Eviction Ban

The eviction moratorium introduced by the Act shall continue to prevent landlords from enforcing tribunal/court orders for possession of their property for a period of 6 months after these are granted. This restriction is due to apply until at least 30 September 2023. There remain certain exceptions in place for orders granted on the basis of any of three specific eviction grounds introduced by the Act including the sale of the let property to alleviate financial hardship, the landlords intention to move into the let property to alleviate financial hardship or where the tenant is in substantial rent arrears (6 months+). In such cases, enforcement will still be permitted just as soon as orders are issued.

Tenants should be mindful that whilst the ban prevents enforcement, it does not stop landlords from issuing Notices to terminate a tenancy or making an application to the First Tier Tribunal seeking either eviction or payment orders.

Rent Increases

Effective from 1^st April 2023, the rent increase cap shall be raised from 0% to 3%. Private landlords may in some limited circumstances apply to have the 3% cap increased further to 6% where it may assist with increased costs associated with the tenancy. This will however be considered on a case by case basis. More guidance is still to be provided on this process however Scottish Government statistics suggest that this has been used sparingly since the Act was introduced.

Initial Reaction

The Scottish Landlords Association (SAL), Scottish Land and Estates (SLE) and Propertymark have announced that they have petitioned the Court of Session to carry out a judicial review of the Act. They believe that the provisions of the Act are disproportionate and unfair to landlords and letting bodies.

A survey carried out over November and December 2022 amongst members of SAL found that 65% of landlords surveyed were dependent on the rental income they receive for their own day to day living, and that rent arrears as a whole had increased with average arrears now being £2,662 per landlord. The survey also found that 54% of tenants were paying rent at a rate below market value and that 87% of landlords were planning to sell up, stating the new legislation as either a factor or their sole reason for doing so. Needless to say the measures introduce by the Act have not been well received amongst many in the private lettings sector.

If you would like to discuss the impact of the Act on your own circumstances please do not hesitate to contact our expert debt recovery team led by experienced partner David Alexander on 0131 516 5354 or by email: dalexander@gilsongray.co.uk.