Rent controls: Above inflation rent rises are not good enough
When the Scottish Parliament reconvenes next month, the Scottish Greens plan to force a vote on a proposal to reintroduce rent caps in Scotland. The previous rent caps - introduced during the pandemic - were unceremoniously dropped by the Scottish Government last year after vociferous lobbying by landlords and the construction sector who stand to profit from squeezing tenants as much as they can get away with. The caps were replaced by a complaints scheme that places the burden of proving that rents are unfair onto tenants who already have far less power than their landlord.
The Greens’ proposal is for the reintroduction of a rent cap of the lower of either 6% or of inflation plus 1%. For most “normal” economic times this means that rents are all but guaranteed to increase by more than inflation and thus the cap will not ultimately serve tenants but will merely ensure that landlords can continue to profit from housing. Promising tenants above inflation rent rises in areas where rents are already too high will not help to bring those rents down. Guaranteeing landlord profits regardless of the conditions in which they keep their homes will not encourage them to repair broken homes or to retrofit homes to meet climate demands.
In 2019 - before the pandemic - Common Weal worked with Living Rent to design a rent control system that would do all of this. Our proposal, designed after one that already works successfully in the Netherlands, scores homes on a points-based system around their energy efficiency, general quality and state of repair. Houses that do not meet the full score will have their maximum rent capped compared to the local “market rate” so that landlords are forced to maintain their property in a decent condition if they want to maximise their rent. We also call for tenants to be given the power that tenants in countries like Germany have to withhold rent until critical repairs are made and for the right to make reasonable modifications to their home - such as decorating but also the installation of accessibility aids - as if they were the homeowner.
We also call for the Landlord Register to be expanded so that tenants can search for their landlord, can see how many other properties they own and what they are charging those tenants in rent as well as to search for the rent being charged in similar properties in their area (this helps prevent discrimination where a landlord may, for example, try to overcharge a migrant or vulnerable tenant).
Ultimately these rent caps and rent controls are only the first stage in an actual solution to Scotland’s housing crisis. The profit motive must be removed from housing. To do this will require supporting Local Authorities to build and restore enough social houses at a high enough quality and at a low enough rent that the private rented sector must either radically reform to stay competitive or the exploitative landlords who refuse to do so will ultimately no longer be able to profit from renting - at which point Local Authorities can buy their excess housing at a fair price and bring them (or, in many cases, return them) to the social rented housing stock too.
