Renting in Scotland is changing. December 2017 heralds a new era which affects everybody who rents or lets a private residential property. Assured and short assured tenancies in Scotland (SATs) will soon become a thing of the past. As at 1st December 2017 a new tenancy regime, called the private residential tenancy (PRT), comes into force and will apply to all new tenancies. This new system is aimed to improve the private rented sector by providing increased security, stability and predictability to tenants and safeguards for landlords, lenders and investors.
So what’s new?
Renting in Scotland is being revolutionised in three major ways:
- No fixed term – tenancies will be open ended and the parties won’t be able to agree a fixed duration for the lease.
- Removal of the ‘no fault’ ground for repossession – landlords won’t be able to end the tenancy unless one (or more) of the 18 grounds for possession can be applied.
- Rent can only be increased once every 12 months and tenants must be given three months notice.
New tenancy model
Landlords and letting agents must provide all tenants with a written tenancy agreement by law. The Scottish Government has published a model form of private residential tenancy agreement that can be used by landlords and agents. It’s not compulsory however and an alternative tenancy agreement can be used at the landlord/agent’s discretion, provided it sets out all of the statutory terms – rent receipts, rent increases, subletting, notification about other residents, access for repairs and termination.
The new model tenancy agreement contains two types of clauses;
- Mandatory clauses (in bold typeface), which must appear in any agreement prepared using this model
- Discretionary clauses (ordinary typeface), which may be amended or removed altogether as required.
Landlords and agents can insert additional clauses as long as they don’t contradict any of the mandatory ones.
If the new model lease is being used, landlords/agents must give tenants the tenancy agreement along with a copy of the ‘Easy Read Notes for the Scottish Government Model Private Residential Tenancy Agreement’.
When an alternative tenancy agreement is being used, tenants must be given a copy of the ‘Private Residential Tenancy Statutory Terms Supporting Notes’.
Failing to issue tenants with the written documents may result in a complaint to the First-tier Tribunal for Scotland Housing and Property Chamber, who can order the landlord/agent to pay tenants up to three months’ rent.
The AT5 form, tenant information pack (TIP) and prior notice of grounds no longer need to be issued.
What happens to existing tenancies?
The new regime doesn’t affect existing tenancies (including those renewing on a contractual basis which are typically rolling monthly). They will carry on until terminated by the landlord or tenant.