The Scottish Government has faced criticism for exempting mid-market rent (MMR) and build-to-rent (BtR) homes from rent controls in the Housing (Scotland) Bill. Housing Secretary Mairi McAllan confirmed the exemptions in a letter to the Local Government, Housing and Planning Committee, and later told the PA news agency that caps could hinder necessary housebuilding. The bill would let councils designate rent-control zones, with annual increases capped at inflation plus one percentage point.

An open letter from Living Rent calls on Ms McAllan to rethink the exemptions. Ruth Gilbert, the union’s national campaigns chairwoman, argues that exempting MMR and BtR would create a two-tier system that’s unworkable and leaves thousands of tenants with no recourse to challenge unfair rent hikes. The letter notes that build-to-rent rents are among the most extortionate in our cities and warns that exemptions would enrich international hedge funds at tenants’ expense. It includes the line: ‘As you very well know, exempting MMR and BtR housing will create a two-tier system that’s unworkable and leaves thousands of tenants across Scotland with no recourse to challenge unfair rent hikes.’ The letter also contends that build-to-rent exemptions would turn cities into playparks for investors, warning the policy could degrade local communities.

Responses to the housing bill consultation were published. More than 4,600 submissions were received, with 94% saying mid-market rent should not be exempt and 97% opposing build-to-rent exemptions. Among standard responses, 70% opposed exemptions for build-to-rent and 52% supported an exemption for mid-market rent. McAllan defended the exemptions, saying they would encourage investment and increase housing supply. She cited a Housing Investment Task Force recommendation that the right conditions are needed to attract mid-market investment and improve availability. Asked about possible market squeeze, she said the aim was to expand the market to create a mix of social, mid-market and BtR housing, boosting supply and affordability. ‘We need more houses,’ she stated.