3 November 2023
The UK Apartment Association (UKAA), the body which represents the Build to Rent (BTR) sector, today responded to the findings of the Judicial Review in favour of the Scottish Government’s move to impose rent controls in Scotland.
For the BTR sector to deliver the long-term quantity of good quality, professionally managed homes needed to help tackle the critical housing crisis in Scotland (the future BTR pipeline in Scotland currently stands at nearly 9,000 homes, Rettie & Co., 2022), confidence is required of investors, developers, contractors, and all those involved right through to the customer. This confidence is built through clarity, certainty, and consistency – all of which are undermined by rent control.
In principle, the UKAA opposes rent cap in any form as it lowers confidence and inhibits the BTR sector’s ability to deliver customer, community and investor value. Investors invest for the long term, for stable returns and if rent control is in play, it can disrupt and harm the certainty of those returns.
The limited BTR stock in Scotland has been well received by the market to date but following the rent cap announcement, investor confidence has been affected. Some investors are already pausing and / or withdrawing from the market entirely which can only harm the delivery of these much-needed, good quality homes.
The Scottish government has made social housing providers exempt from this cap. As both social landlords and BTR providers hold the same aspirations to deliver good quality housing, in good quality communities, the UKAA argues that the BTR sector should be treated in a similar manner.