COLA extended to 31 March 2024

Yesterday the Scottish Parliament approved legislation to extend the Cost of Living (Tenant Protection)(Scotland) Act 2022 (COLA) from 30 September 2023 to 31 March 2024. 83 MSPs voted in favour of the extension and just 27 voted against it. This is the final extension permitted under the legislation. This means that the eviction moratorium and rent caps of 3% (or 6% for increases in prescribed property costs) will remain in force until the end of March. For further information on COLA please see our factsheet here.

Rent controls after 31 March 2024

The minister for tenants’ rights, Patrick Harvie, along with his colleagues in government have indicated that some form of rent control will remain in force after the Cost of Living (Tenant Protection)(Scotland) Act 2022 (COLA) ends on 31 March 2024. The COLA legislation allows amendments to be made to the rent adjudication process and it is expected that this is the mechanism which will be used to control rent increases after 31 March 2024.

Prior to the COLA legislation tenants who received a rent increase notice could refer it for adjudication to the rent officer. The rent officer was then required to assess the open market rental value for the property and set the rent at that figure.

The COLA legislation allows for a change to the rent officer’s duties to require them to set the rent not in line with market rents but in line with some other mechanism, such as one linked to inflation. If this were introduced it would mean that landlords could issue a rent increase for any amount but their tenant could then have the increase reduced by application to the rent officer.

The government has indicated that an announcement will be made on this in the next few months.

Longer term the Scottish Government committed in its New Deal consultation in 2021 to “introducing an effective national system of rent controls, with an appropriate mechanism to allow local authorities to introduce local measures by the end of 2025”. While SAL is a member of a rent control stakeholder engagement group set up by the government, no clarity has yet been provided to the group on what form this new system of rent controls will take. The detail is expected to be set out in a consultation paper which is due to be published in the next few weeks.

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