We thought it would be a good idea to take a closer look at the changes to Private Rented Sector in Scotland that will come into force as a result of the new tenancies Act.
The details of the new Act and a copy of the model tenancy can be found here.
The Private Housing (Tenancies) (Scotland) Act 2016 will introduce a new tenancy regime into Scotland as of 1st December called the Private Residential Tenancy (PRT). The act provides that after this date, a tenancy cannot be an assured or short assured tenancy hence all residential tenancies let to individuals will be by default a PRT.
Our understanding is that existing tenancies will continue to be assured tenancies until terminated.
The main points to note are:
• There will be no minimum term.
• A new model tenancy agreement has been published by the Scottish Government and there are terms clauses contained within it that are mandatory and must be included in any tenancy document.
• There will be no pre-tenancy notices.
• Tenancies can continue indefinitely unless either the tenant wants to leave or the landlord decides to utilise one of the 18 grounds for repossession detailed in the act some of which are mandatory and some of which are discretionary. The “no fault” ground for repossession has been removed.
• Only one notice to leave will needed to end the tenancy, with tenants being required to give four week’s notice to leave, no matter how long a tenancy has been running.
• If a tenant refuses to leave the property after being given notice by the landlord, the landlord will have to seek repossession through the First Tier Tribunal (FTT).
• The period of notice that a landlord is required to give to a tenant to terminate a PRT is 28 days (where the tenant has been entitled to occupy the property for not more than six months), or 84 days (where the tenant has been entitled to occupy the property for more than six months). In certain circumstances, such as where the tenant has engaged in antisocial behaviour, or where the tenant has been in rent arrears for three or more consecutive months, 28 days’ notice is required, regardless of how long the tenant has been entitled to occupy the property.
• Rents can be reviewed only once in a twelve month period with a landlord required to give the tenant at least three month’s notice of the increased rent. Tenants can challenge the proposed rent increase by seeking an order determining the rent from the rent officer. The rent officer must determine the open market rent which is “fairly attributable”; appeals can be made against such orders to the First Tier Tribunal.
• Local authorities can apply to the executive to designate areas as rent pressure zones (RPZ’s). These will regulate rent on existing tenancies but not new tenancies. If a council is successful a RPZ can last for up to five years and landlords in the areas affected will be able to raise rents by at least CPI+1% every twelve months.
Part two of this blog featuring our comments on the Act will follow shortly.