Fears that banning section 21 will harm the PRS in England are entirely misplaced, based on contradictory evidence in Scotland, according to The Social Market Foundation (SMF), a claim that landlords have rejected.
The think-tank says “faulty economic claims” prompted the government to delay plans to ban no-fault evictions, while MPs who threatened to vote against it argued that the ban would cause landlords to exit the market, shrinking the properties available to rent at a time of high demand.
SMF points out that in Scotland, no-fault evictions were effectively banned in December 2017, yet concerns that the private rented sector would shrink proved pessimistic; its private sector grew at a faster rate between March 2018 and March 2020 than England’s, although the two had followed similar trends.
In 2019, Scotland saw its private rented sector grow at its fastest rate since 2011.
It believes this is especially striking given that Scotland’s ban was accompanied by wider protections for renters including introducing open-ended tenancies and demanding longer notices on behalf of landlords to vacate.
SMF adds: “In comparison to Gove’s plan, these changes made renting far more burdensome for landlords, yet were followed by market expansion.”
However, the Scottish Association of Landlords says Landlord Register figures clearly show a reduction of 20,000 properties since the introduction of the new tenancy regime banning no fault evictions (from 361,884 in January 2017 to 338,768 in March 2022).
This will now be exacerbated as a result of the Scottish government’s anti-landlord policies as it forges ahead with its plans to introduce permanent rent controls in Scotland.
Chief executive John Blackwood (pictured) tells LandlordZONE: “With local authorities in Scotland declaring housing emergencies, the Scottish Government needs to have a major rethink of how it works with those in the private rented sector and develop a credible policy that is acceptable to the market and stops the decline in much needed rented accommodation.”