The SNP have created a housing nightmare

The SNP government can’t see a house fire without wanting to throw petrol on it. Scotland’s housing crisis is only too apparent to anyone looking for accommodation right now. Homelessness is rising rapidly with evictions doubling in a year; a quarter of a million Scots are on social housing waiting lists; and rents are going through the roof. Yet, the SNP Government and its Green partners seem determined to make matters worse by pursuing an ideological assault on private landlords which is forcing them out of the market. 

House prices have long been unaffordable in Scotland, having tripled since 2000. But now even the rental market is broken at every level. Long term rents are rising by over 10 per cent a year and now stand at £1,100 a month on average – while they are £1,400 in cities like Edinburgh. This is despite the ‘emergency’ 3 per cent cap placed on private sector rents by the Scottish government last year. New rental properties are exempt from the cap and landlords have been hiking rents at changeover to reflect inflation and rising interest rates.

This is what invariably happens when governments try to control rents. It just reduces supply and increases inequality, as academic studies have shown. But the Scottish government hasn’t learned. Humza Yousaf promised yesterday in his programme for government to impose a further assault on private landlords by introducing long-term rent controls. This would mean the Scottish government effectively suspending the market altogether and dictating rents across Scotland.

The policy, enthusiastically promoted by the Greens tenants’ rights minister, Patrick Harvie, will only increase the stampede of landlords leaving the market. Landlords are already selling up in droves because of constant regulatory changes and restrictions. The supply of houses for long-term rent has halved on some estimates. The shortage has led to an unseemly scramble for every new flat that comes on the market and to local spikes in rental costs. Large scale ‘Build to Let’ projects are also going south. A £200 million plan to build 1,500 homes for rent in Glasgow has been shelved by developers as a direct result of the Scottish government’s rent controls.

Landlords are now taking their fight against the government to the courts. The Scottish Association of Landlords has submitted a Petition to the Court of Session in Edinburgh seeking a Judicial Review of the Scottish government’s existing rent controls. They’re claiming unlawful discrimination because the freeze does not apply to the social housing sector. Housing Associations are allowed to increase rents to reflect increased costs, so why aren’t private landlords?

But there is little public sympathy for the private landlord and Yousaf cannot resist playing to the gallery, even though his civil servants must know that rent controls don’t work. They can limit rises in the short term but lead to housing costs actually increasing because of the shortage of supply. That’s been the experience of just about every city that has imposed them.

Landlords have a terrible reputation but they aren’t all bad. Moreover, they are an important component of Scotland’s dwindling housing supply. There are around 200,000 small landlords in Scotland owning one or two flats. Their departure will only increase rents while tenancies decline and Airbnb continues to pock-mark city centres with ugly security key boxes.

Airbnb has even fewer friends than buy-to-let. However, ham-fisted attempts to crack down on the cowboys has inflicted collateral damage on Scotland’s many family-run bed and breakfast establishments. They are rebelling against new regulation and registration charges. According to the Association of Self Caterers, 61 per cent of bed and breakfasts and small holiday let businesses are preparing to shut their doors at the end of September. This has dismayed the Scottish tourism industry. It’s hard enough to find a respectable bed and breakfast place at a reasonable price in the Highlands – in future it can only get worse.

It took governmental incompetence of epic proportions to create Scotland’s housing omnicrisis. After 16 years in government the SNP has succeeded in undermining the sector across the board. Young families and those on modest incomes could be forgiven for thinking there’s a conspiracy to make them homeless.