Explanatory note

These Regulations specify descriptions of properties which are to be exempt properties for the purposes of Parts 4 and 4A of the Private Housing (Tenancies) (Scotland) Act 2016 (“2016 Act”). Part 4 of the 2016 Act sets out restrictions on rent increases in areas which have not been designated as rent control areas. The Part 4 restrictions will also apply to exempt properties in rent control areas. Part 4A of the 2016 Act, as inserted by section 23 of the Housing (Scotland) Act 2025, sets out restrictions on rent increases in rent control areas. The Part 4A restrictions will not apply to exempt properties in rent control areas.

Regulation 3 provides that build to rent properties and mid-market rent properties are exempt properties, which are defined in regulations 4 and 5 respectively.

A build to rent property is described as a property forming part of a development of 6 or more residential properties, all in single or joint ownership, all covered by the same planning permission, and where the completion date for the property is on or after the Scottish Ministers’ announcement of the intention to introduce rent control (“relevant development”). That announcement was made on 31 August 2021. The exemption would no longer apply if the property is owner-occupied, used for a short-term let, removed from the landlord’s entry in the landlord register, or no longer part of a relevant development.

A mid-market rent property is described as a property where the landlord is prevented from increasing the rent in three specified circumstances, those restrictions prevent the landlord from increasing the rent above a specified level and the rent is not increased above that specified level. The restrictions on rent increases can be in the form of conditions attaching to direct or indirect funding for the provision of the mid-market rent or via conditions in the tenancy agreement. The specified level above which rent cannot be increased is the median of market rent levels for a property of that size (or, in certain circumstances, similar size) in that broad rental market area.