SNP ignored warnings European-style rent controls would cause ‘chaos’

SNP rent controls are so damaging to the housing market that they should be a cautionary tale to other countries, an expert has said. Ireland, Germany and Sweden have also suffered unintended consequences after experimenting with rent controls. However, Dr Andrew Watson, of the University of Glasgow, has said in a review that the SNP ignored warnings that tinkering with the Scottish market could cause chaos and harm the tenants it was trying to help. Most commented 1 My partner died. Then I found a text: ‘Shall we have an affair?’ Sex & Relationships 219 comments 2 I sleep with my dogs. A new study proves it’s better for me Pets 133 comments 3 Harvey Elliott was England’s next great hope. Now he’s out of the picture Football 71 comments 4 500 arrested as French police use tear gas during student protests Europe 52 comments 5 Oliver Glasner: Premier League’s integrity at risk if Man City case drags on Football 33 comments The review found that landlords were quitting thanks to a flurry of new regulations including rent caps and eviction bans and that “constitutional uncertainty” was deterring private investment in new apartments. Top stories 1 Trump Jr’s ex-fiancée ‘asked donor to pay 0k credit card bill’ US politics 2 Trump’s war with Iran doubles the cost of his rides in ‘the Beast’ US politics 3 Starbucks ‘explores takeover’ of Chipotle Mexican Grill US business 4 ‘More lives will be lost’ unless UK takes action on wildfires Environment The review by Watson, a specialist in how policy affects behaviour in the rental market, accused ministers of muddled thinking and urged other nations not to follow Scotland’s example. It said: “While the Scottish government’s long-term commitment to rent controls can be seen as congruent with its commitment to social justice, it does not appear to have learnt from contested narratives and debates within international political economy regarding rent control and its potential impacts.” Advertisement It added that the SNP’s strategy had been “underwhelming … and potentially problematic, given its likely contribution to the departure of small-scale landlords in the context of an ongoing housing emergency”. Top stories 1 New How Bob Marley became an unlikely beneficiary of the slave trade History 2 New Milos Raonic: Wimbledon finalist to investment banker at Goldman Sachs Tennis 3 South African lawyer Navi Pillay wins 2026 Nobel peace prize Europe 4 New Mortgages rates dip after weeks of painful rises Mortgages 5 New ‘My husband’s family want us to pay £500 towards his sister’s holiday’ Ask Times Money Watson said: “This paper provides cautionary lessons for policymakers in other jurisdictions.” Dr Andrew Watson Measures in the SNP’s latest Housing Act include giving ministers powers to designate rent control areas, and making it harder to evict non-payers. Landlords will also soon be unable to impose a blanket ban on tenants making minor alterations to properties or on keeping pets. The powers came into force in April . More than 750 properties disappeared from the private rental market between November last year and August this year. The rent cap imposed by the SNP and the Greens between October 2022 and March last year was blamed by some for forcing up prices in parts of the central belt. Advertisement Danny Pinder: Why rent controls are no good for landlords or tenants Academics have researched the effects of controls elsewhere. In Ireland, the number of available properties fell sharply after rent restrictions were introduced in 2016. In Germany, a similar system introduced in 2015 led to decline in rental property quality and poorer families being squeezed out of the market. Sweden’s long-running scheme has created waiting lists of more than a decade, as well as a black market dodging restrictions. Watson’s review, published in the International Journal of Housing Policy, detailed how ministers have tried to encourage build-to-rent developments, in which corporate landlords convert large buildings into serviced apartment blocks. How Scotland’s rent caps backfired Advertisement However, construction activity in that sector has fallen by 27 per cent in a year, more than in any other part of the UK. Watson said: “Cost pressures are not unique to Scotland. A further possible explanation lies in Scotland’s political context, including ongoing constitutional uncertainty.” The Scottish Conservatives described Watson’s review as a “damning indictment”. James Adams, the party’s housing spokesman, said: “We tried to stop this disastrous housing bill becoming law, but the SNP and Greens piled more regulation onto a sector already in crisis. “Families are being failed, landlords are leaving and investment is drying up, yet John Swinney’s priority is dragging Scotland back into another constitutional fight. This worsening housing emergency is crying out for action, while the SNP keeps obsessing about independence.” Scotland newsletter Your weekend briefing from the Scotland edition of The Times and The Sunday Times. Sign up with one click You’ve successfully signed up to the Scotland newsletter Explore our newsletters An error occurred. Please use the link below. Scotland newsletter Explore our newsletters John Blackwood, chief executive of the Scottish Association of Landlords, said: “We warned that heavy-handedness, including rent controls, would send the wrong signals to landlords and cause some, especially smaller businesses, to reduce their portfolios or leave the sector completely. Advertisement “The data shows that we were right to do so. The Scottish government should commit to working with landlords, investors and tenants to restore market confidence and attract investment, and build a private rented sector that works for everyone.” A Scottish government spokesman said: “A well-functioning and well-regulated private rental market is vital, which is why we have made build-to-rent and mid-market rent exempt from rent controls under the Housing Act and consulted on using the powers in the act flexibly in appropriate circumstances. “Ministers will continue to work closely with industry to support investment in quality homes, backed by record investment of up to £4.9bn over the next four years for affordable housing.”