18 Mar 2025
By Fraser Paterson, Head of Public Affairs, BIG Partnership
Scotland is in the grip of a housing crisis. Rising rents, a shrinking supply of homes and stalled investment are making it increasingly difficult for people to find affordable housing. Yet, the Scottish Government’s Housing (Scotland) Bill, introduced in 2024, focuses heavily on rent controls. While rent controls may seem like a solution, they fail to address the real issue: a lack of housing. As the Bill moves to Stage 2, concerns are mounting over its long-term impact—but there is still time to get this right.
A bill without new homes
The most glaring flaw of the Housing (Scotland) Bill is its failure to deliver new homes. The central issue is the lack of supply, not rent gouging by landlords. Rent levels are high because there simply aren’t enough homes to meet demand. Housing experts, including Propertymark, argue that rent controls do nothing to address this fundamental problem.
Without increasing supply, rent control is little more than a short-term political gesture. Scotland needs new homes—across all sectors—yet the Bill delivers none.
A market in decline
Exacerbating the challenge, landlords are leaving the private rental market in droves. The Scottish Association of Landlords reports that more than half of its members are considering selling their properties. Many cite the government's rent control policies and hostile environment as key factors. This trend is dangerous. As landlords exit, fewer rental properties are available, further tightening the market and pushing rents higher.
The Scottish Government defends its rent cap of CPI+1% with a 6% ceiling, claiming it is a fair compromise. But experts warn that this will do more harm than good. Reduced investment in the private rental sector will lead to even fewer homes available for rent. Furthermore, the government's promise to exempt Build-to-Rent (BTR) and Mid-Market Rent (MMR) properties from rent controls remains uncertain. Without clear exemptions, investor confidence will continue to erode.
Political uncertainty
The political landscape surrounding the Housing (Scotland) Bill is also unstable. The Scottish Greens, once key allies in shaping housing policy, have exited the coalition government. This leaves the SNP in a minority, making it harder to pass legislation. Internal divisions within the SNP Cabinet further complicate matters. Speculation about these divisions could delay or even derail the Bill.
With elections looming in May 2026, the Housing (Scotland) Bill risks becoming a political football. Housing will be a central issue in the election, and if the Bill is not passed by the end of 2025, it will likely become embroiled in election politics. Delays could render the Bill ineffective, preventing meaningful reform and increasing uncertainty.
A chance to get this right
Despite these challenges, there is an opportunity to deliver real change if the Bill is amended to focus on boosting housing supply. If government, investors, and the housing sector can work together, Scotland could see a surge in investment, unlocking much-needed new homes for renters and buyers alike. Policymakers have a chance to get this right—but only if they listen to the concerns of those who understand the market and are willing to invest in its future.
The path forward
Scotland’s housing crisis cannot be solved with rent controls. The government must focus on increasing the supply of homes across all tenures. More private investment in rental housing is essential, as is expanding the stock of social housing. The current focus on rent controls without a plan for increasing supply is a recipe for failure.
As things stand, the Housing (Scotland) Bill risks making the housing crisis worse. Without urgent amendments to balance tenant protections with investor confidence, Scotland could face a future where fewer homes are available, rents continue to rise and the private rental sector shrinks even further.
The solution is clear: we need more homes, not more regulation. There is still time to ensure this Bill delivers real solutions—not just political headlines. Those with a stake in Scotland’s housing market must make their voices heard and engage with decision-makers now, before the opportunity is lost.
You can’t fix Scotland’s housing crisis without building more homes. Rent controls don’t work if there’s nowhere to live.
