Council and housing association tenancies exempted from rent cap

Council and housing association tenancies in Scotland were removed from the temporary rent cap on 26 February 2023, according to guidance from Business Debtline¹. The cap continued to apply to most private tenancies¹.

The Scottish Government announced a temporary rent cap and ban on evictions for most tenants from 6 September 2022¹. The cap was set at 0%, meaning that in most cases a landlord could not ask for an increase until 1 April 2023¹. It then rose to 3% from 1 April 2023¹. Both the eviction ban and the rent cap ended on 31 March 2024¹.

Some tenancy types were not subject to the cap at all, including a tenancy that started before 1989, called a regulated tenancy, or a lodger agreement where the tenant lives with the landlord². Private landlords could seek an increase above the cap in limited circumstances, where mortgage interest payments, insurance premiums or service charges related to the property had increased¹. Where a landlord could apply for an increase, the guidance states that a tenant should only pay 50% of the landlord's increased costs up to a maximum of 3% of the current rent, rising to a maximum of 6% from 1 April 2023¹.

The guidance covers Scotland only and states that different advice applies in England and Wales¹. It also sets out the position on evictions during the ban: a landlord could still apply to the court or tribunal, but in most cases could not evict until the ban ended¹. Exceptions included antisocial behaviour, criminality, an empty property, a landlord needing to sell or live in the property because of financial difficulty, and the tenant living with the landlord¹. Private tenants with arrears of six months or more, and social tenants with arrears of £2,250 or more, were also among the exceptions¹.

Why it matters for households

For social tenants in Scotland, the change meant that from 26 February 2023 a council or housing association landlord was no longer bound by the cap when setting an increase¹. Private tenants remained covered until 31 March 2024, when the cap and the eviction ban both ended¹. After that date, a private landlord wanting to raise the rent must send a rent increase notice, and a tenant who thinks the increase is too high can challenge it, with a rent officer working out the correct amount based on the value of the property and the current rent².

The wider regulation and policy context includes the benefit rules that affect what tenants pay. For social tenants of working age, Housing Benefit can be cut by 14% for under-occupying by one bedroom, or 25% for two or more bedrooms¹. The Department for Work and Pensions should start paying the housing costs element of Universal Credit within five weeks of a claim, and the council should start paying Housing Benefit within 14 days¹. Deductions from Universal Credit can be up to 20% of the standard allowance¹.

What happens next

The rent cap and eviction ban ended on 31 March 2024¹. For private tenancies, rent increases sought on or after 1 April 2024 require a rent increase notice, which can be challenged². No further measures have been reported.