Scottish Ministers have written to stakeholders, including the Scottish Property Federation (SPF), to clarify the next steps for the 28-day notice amendment due to be tabled for consideration at Stage 3 of the Housing (Scotland) Bill.
By Scottish Property Federation
This amendment will provide a regulation-making power for Scottish Ministers to bring a 28-day notice period to quit for student tenancies into being. The detail of the power will be consulted on ahead of Regulations being laid before the Scottish Parliament.
The Scottish Government has explained that these powers are expected to be based on very specific circumstances. Based on the feedback from purpose-built student accommodation (PBSA) providers in last year’s government consultation survey exercise, a number of circumstances such as student illness, family bereavement, or moving to different institutions have been suggested.
Investors and providers of PBSA have been deeply concerned with the sudden regulatory interventions during the Housing Bill proceedings. Investors in new PBSA need certainty of the regulations and an untrammelled 28-day notice for a closed market, such as the student sector threatened to undermine the very basis of these major investments.
If a student decides to leave at 28 days’ notice, then accommodation providers can only seek to replace them with other students. If notice periods were made by students, for example, at later stages in the academic year, this would make it nigh on impossible to replace the vacancy, and operators and investors would have to assume potentially significant voids. Nevertheless, there are exceptional circumstances where it is only right that students can, in urgent and understandable circumstances, need to vacate a tenancy.
This investor uncertainty came shortly following the decision of the Scottish Parliament to support amendments for rent control purposes which could include the PBSA sector, and the Cabinet Secretary has reaffirmed a number of times that it is not Scottish Government policy to include PBSA within the scope of rent controls and will work with other parties ahead of stage 3 to ensure the PBSA is not brought within the scope of the rent control regime. We hope to see this change to the Bill reversed, therefore, at Stage 3.
In addition to this, the Stage 3 amendment on 28-day notice has added to the uncertainty. If based on the best practice as identified by the industry in last year’s consultation, then this is a welcome clarification, and we look forward to engaging on the details of the proposals as soon as possible.
It is worth noting that there is an ongoing consultation (running until 18 July 2025) on the types of property that may be exempt from rent controls under the Bill. It is anticipated that Build to Rent properties may benefit from an exemption. PBSA is not part of this consultation as, at the time the consultation opened, the sector was not within scope.
