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‘Flippant Disregard’ A Disincentive To PRS In Scotland

Unless the Scottish Government reverses its ‘flippant disregard’ for the lot of private landlords, investment in the sector will only decline further, and rents will continue to rise.

This is what the letting agents’ professional body Propertymark has said in a letter to Deputy First Minister, John Swinney.

The Government ‘needs to drastically improve the way that it values the private rented sector as it plays a huge role in housing the nation’, said Propertymark chief executive Nathan Emerson. He called for the 6 per cent Additional Dwelling Supplement to be reversed and for a general review of taxes on landlords.

Prior to the Additional Dwelling Supplement increase almost 70 per cent of letting agents had noticed an increase in notices to sell from their landlords, said Emerson. ‘This was as a direct result of the Scottish Government’s decision to cap rents under the Cost of Living (Tenant Protection) (Scotland) Act 2022’. Increased burdens encouraging private landlords to sell up included withdrawal of tax relief on mortgage interest costs and replacement with a 20 per cent tax credit, removal of the 10 per cent wear and tear allowance for fully furnished properties, maintenance of capital gains tax at 28 per cent on rental properties when it was reduced to 18 per cent for other assets, and a rise in corporation tax from 19 per cent to 25 per cent from 2023.

‘The lack of property is the root cause of rent increases and rising figures on social housing lists. We believe the PRS is a key solution to resolving the housing crisis, but if the Scottish Government continue with policies that disincentive landlords it will only make the situation worse’, said Emerson. * Landlords are split on the worth of a requirement in Scotland for letting agents to obtain a professional qualification.

A report, commissioned by the Chartered Institute of Housing, found that nine in ten letting agents who had undertaken a qualification said it had had a positive impact on their professional capabilities. However, only 51 per cent of landlords said the requirement for them to obtain such a qualification had benefitted the private rented sector overall. Legislation passed in 2014 concerning the regulation of letting agents in Scotland introduced the requirement for qualification as a way of improving the standard of service for those renting properties from letting agents.

Letting agents told CIH that the change had worked. Some 84 per cent of letting agents said the requirement had had a positive effect and that more people were now looking at property agencies as a long-term professional career option.

The letting industry body Propertymark, which offers a suitable qualification, said It was pleasing to see that the majority of letting agents who had obtained a relevant qualification acknowledged its positive impact.
‘The report highlights the need to make training accessible for people and that is why Propertymark qualifications are set to be able to use an interactive, remote invigilation platform’.

Propertymark offers its Level 6 Award in Residential Letting & Property Management – Scotland while ‘membership provides an avenue for letting agents to log CPD and receive ongoing training and resources’.