Scotland abolished fixed-term tenancies in 2017. Scottish letting agent Kevin Davidson-Hall shares insights on the upcoming legislative changes in England.
Letting agents in England are concerned about the changes under the Renters' Rights Bill, which will overhaul everything from evictions to notice periods and, most notably, abolish fixed-term tenancies.
Landlords are also uneasy, as the uncertainty of the proposed changes could potentially discourage new entrants to the market and, therefore, limit rental stock.
However, England isn’t the first part of the UK to face such reforms. In December 2017, Scotland introduced the Private Residential Tenancy (PRT), which also removed fixed end dates, transforming how Scottish letting agents operate.
Here’s a guide to help English landlords learn from Scotland’s experience.
- Did the changes work in Scotland?
- Authority is key for letting agents
- Likely impacts on rent arrears
- Managing change
- Your challenge and your opportunity
Did the changes work in Scotland?
So, how has the new system worked in Scotland?
In my view, the Private Residential Tenancy (PRT) has worked very well despite the plethora of concerns Agents and Landlords had about the changes.
These included worries common to England around the loss of fixed-term tenancies and the possible impacts on Student lettings. None of these worries were proved well founded.
First, do no harm
The phrase "First, do no harm" comes from the Hippocratic Oath, but it’s something our legislators should also bear in mind.
Have the changes in Scotland caused any harm?
In my view, they haven’t - at least, not yet. The only negative effects stem from more recent rent control measures, which I’ll touch on later. That said, I believe the removal of mandatory grounds for eviction went too far.
What About England?
Will the proposed changes in England cause harm? I don’t think so, as long as they are properly thought through and sensibly enacted. But, of course, only time will tell.
Authority is key for letting agents
Letting agents in England must fully understand these changes to advise their clients confidently. You need to be able to "sell" these new regulations.
Practice having these conversations with landlords. Speak with confidence and authority - this will help you win more business and stay ahead of your competitors. Being the most knowledgeable agency on these changes will set you apart.
Likely impacts on rent arrears
From my experience with the 2017 Scottish regulations, the loss of fixed-term tenancies should not directly lead to an increase in rent arrears.
However, my observations are based on clients who use reputable letting agents, solid tenant referencing, and landlord insurance providers, such as Goodlord. Self-managing landlords expose themselves to unnecessary risks. One bad outcome can be very costly, so it’s better not to take the gamble.
That said, the current Renters' Rights Bill proposes longer notice periods, which could result in a slight increase in arrears, as it will take at least a month longer to evict a tenant in default.
Managing change
Often, the fear of change is worse than the change itself. I’m confident that this will be the case here, too.
Landlords will look to you for reassurance, so you need to come across as assured and confident when advising them.
Your challenge and your opportunity
If you want to thrive through these changes, now is the time to raise your game.
A shift in tenancy regulations presents a huge opportunity for letting agents who are prepared. Agents should understand what these changes will mean to their landlords, by supporting them can make you thrive in this industry and stop them from leaving the sector.
Agents should see what has happened in Scotland - take examples from us and how we managed Scotland’s changes from 2017. Get in the know for any future changes to the sector, your landlords will appreciate it.
The best agents will seize this moment to take market share from less informed competitors.
Rent controls and the Renters' Rights Bill
As promised, a few words on rent control. Unfortunately, this Bill includes provisions that amount to rent control. Rent control doesn’t work. We’ve seen this in Scotland, where various measures have been in place since September 2022.
According to ONS data from April 2024, Scotland saw the largest rent increase since 2015, despite the introduction of rent controls. Reduced supply and increasing demand have driven rents up faster than ever before.
With net migration to the UK at over 800,000 annually, demand will only continue to rise. I hope the government listens to what industry experts are saying and quietly drops rent control provisions. Rent control harms both landlords and tenants in the long run—it simply doesn’t work.
As promised, a few words on rent control. Unfortunately, this Bill includes provisions that amount to rent control. Rent control doesn’t work. We’ve seen this in Scotland, where various measures have been in place since September 2022.
According to ONS data from April 2024, Scotland saw the largest rent increase since 2015, despite the introduction of rent controls. Reduced supply and increasing demand have driven rents up faster than ever before.
With net migration to the UK at over 800,000 annually, demand will only continue to rise. I hope the government listens to what industry experts are saying and quietly drops rent control provisions. Rent control harms both landlords and tenants in the long run—it simply doesn’t work.
