Lessons from Scottish Rent Controls

AT A GLANCE

• Rent caps slowed increases for existing tenants but did not stop rental growth for those moving home. Newly agreed rents in Scotland rose by 8.2% a year while controls were in place, above the 6.7% GB average.
• The burden of rental growth shifted. Sitting tenants were more protected, but movers faced higher re-let prices as homes reset to open-market rents.
• Rent rises became less frequent, but larger. In 2025, 28% of Scottish tenants saw a rent change, compared with 53% in England; where rents rose, the average uplift was 8.3% versus 5.6% nationally.
• Mobility appears lower. New let homes account for around 27% of Scottish tenancies each year, compared with 35% nationally.
• The lesson for England: rent controls cannot be separated from supply — especially when rental growth is now far more muted than Scotland’s post-Covid market.
• Rent controls can take many shapes and sizes. Given Westminster’s history of following elements of Scottish housing policy, Scotland’s experience offers a useful guide to how rent restrictions can reshape a rental market — particularly now the Renters’ Rights Act has moved England closer to Scotland’s system of rolling tenancies. This analysis is based on Connells Group’s lettings data, drawing on one of the largest private rented sector datasets in Great Britain.

The timing matters. England is entering a new phase of rental reform just as rental growth has become much more muted than it was in Scotland when caps were introduced. That raises an important question for policymakers: not just whether rent controls work, but whether they are the right tool for the market England faces today.

Scotland’s experience suggests rent caps acted mainly as a short-term brake for existing tenants rather than a lasting solution to affordability pressures. Rents still rose, but in a different way: sitting tenants were more protected, while movers were exposed to higher open-market prices as landlords reset vacant homes to market rates.

The bigger risk is supply. Prolonged restrictions can make the sector less attractive to both private and institutional investors, particularly when interest rates and operating costs are also rising. Stock levels in Scotland fell when rent caps were in place while rising in England over the same period. Ultimately, rent controls may change how pressure shows up in the market, but they do not remove the underlying shortage of homes.

Aneisha Beveridge, Head of Research at Connells Group, said:

“Scotland shows that rent controls are not a simple fix. Scotland’s caps were introduced during the post-Covid cost-of-living squeeze, when rents on newly let homes were rising at a double-digit pace. Today, the picture in England looks very different, with rental growth much more muted and running below inflation. That does not mean affordability pressures have gone away, but it does mean policymakers need to be clear about the problem they are trying to solve.

“In Scotland, rents still rose during the restrictions — they just rose in a different way. Tenants who stayed put were sheltered from the full force of market rent growth, but those who moved paid the price as landlords reset homes to open-market levels. Rent caps can therefore slow growth for existing tenants, but they can also change landlord behaviour, widening the gap between sitting tenants and the open market, and make supply pressures harder to fix.”

A SHORT HISTORY OF RENT CONTROLS IN SCOTLAND (September 2022–March 2025)

1. Emergency Rent Freeze (Sept 2022 – March 2023)

• Cap: 0% across the private rented sector, student accommodation, and social housing (applied retroactively from September 2022).
• Exceptions: Landlords could apply for an increase of up to 3% only if they could prove an exceptional rise in property-running costs (e.g. higher mortgage rates).

2. Rent Cap (April 2023 – March 2024)

• Cap: Increased to 3% for in-tenancy private rents.
• Exceptions: Raised to 6% for landlords demonstrating cost increases.
• Scope: Applied strictly to in-tenancy increases; rents for vacant properties between tenancies could still be set at full market rate.

3. Transitional Measures (April 2024 – March 2025)

After the emergency powers expired on 31 March 2024, temporary rules were introduced to prevent sudden rent spikes where tenants challenged an increase.

The First-tier Tribunal assessed disputed rent increases using a formula based on the gap between the tenant’s current rent and the open-market rent:

• Gap < 6%: Full proposed increase allowed.
• Gap 6% to 24%: Scaled formula cap.
• Gap ≥ 24%: Hard cap set at 12% above the current rent.

MARKET IMPACT

1. Frequency of rent increases

Since 2017, private tenants in Scotland have been on rolling contracts, with rent increases allowed no more than once every 12 months. England has now moved closer to this structure following the Renters’ Rights Act becoming law on 1 May 2026, although in practice very few English landlords were increasing rents more often than once a year.

• Catch-up immediately after the freeze: In the weeks and months after each rent freeze ended, more Scottish landlords served notice to increase rents. The shift to rolling rather than fixed-term contracts meant landlords who had not already reviewed rents increasingly took the opportunity to do so.
• The ‘anniversary’ effect: The original emergency freeze ended in March 2023, creating an artificial annual review point going forwards. Even though there are not currently rent caps in place, many landlords still review their rents around this time
• But fewer rent increases longer term: In 2025, around 53% of English tenants experienced a rent change when their landlord had the opportunity to increase the rent, compared with just 28% of tenants in Scotland.

2. Size of rent increases

The scale of rent increases for existing tenants tended to spike after controls were relaxed. More generally, increases have happened less often in Scotland than across Great Britain, but when they do happen, they tend to be materially larger. In practice, rents adjust through steeper occasional jumps rather than smaller, more frequent steps.

• Scale of increase: Where rents were increased in Scotland, the average rise was 48% larger than the national average, at 8.3% compared with 5.6%. As the chart below shows, larger increases have remained a feature of the market since the sharpest form of rent controls ended in March 2024. Elsewhere in Great Britain, where rents were not suppressed to the same extent, increases have generally been smaller.
• Re-let catch-up: Suppressing in-tenancy rents widened the gap between existing rents and open-market rates. Landlords were therefore more likely to apply larger uplifts when re-letting a vacant property in order to reset it to market value. During the period when price controls were in place, newly agreed rents in Scotland rose by an average of 8.2% a year, compared with 6.7% across Great Britain. While over the last five years, the price of new lets rose 35% in Scotland compared to 29% across Great Britain.

3. Tenant mobility

Over the last decade, private tenants across Great Britain have generally been staying in their homes for longer, one of the factors putting downward pressure on the number of rental homes being advertised. But there are still clear differences between Scotland and the rest of the country in how often tenants move.

• Tenancy lengths: There is limited evidence that temporary caps on rent increases directly affect tenancy lengths. Scottish tenants have historically moved less often than their English counterparts. Each year in Scotland, new let homes represent around 27% of all tenancies, compared with 35% nationally.
• Reset to market rate: Prolonged caps naturally widen the gap between rents paid by existing tenants and open-market rates, creating a growing financial disincentive to move. There is some evidence that, even after the strictest controls were lifted in early 2023, fewer tenants moved home because the gap between their current rent and the rent on a new home had become larger. At the end of the Scottish rent freeze in March-23, there were 39% fewer homes on the rental market in Scotland than a year ago, compared to a 16% rise in England.
• Structural shifts: The bigger structural shift from Assured Shorthold Tenancies to open-ended rolling tenancies appears to extend the average time tenants spend in a property. This could be repeated in England over the coming months and years.

LESSONS FOR POLICY MAKERS

Scotland’s experience offers five important lessons for any future English debate on rent controls:

1. Behavioural distortion: Once lifted, rent caps can encourage landlords to apply the maximum permitted annual increase as a hedge against future restrictions. Over time, the cap risks becoming a benchmark.
2. Two-tier markets: Sitting tenants may benefit from below-market rents, but this can create a strong disincentive to move if the cost of a new home is significantly higher. New tenants and those who need to move face a smaller pool of available homes and higher open-market rents. At the end of the Scottish rent freeze in March-23, there were 39% fewer homes on the rental market in Scotland than a year ago, compared to a 16% rise in England.
3. Capping income, not costs: Rent caps limit landlords’ income but do little to control their costs. Although increases of up to 3% were permitted in cases where landlords’ costs had risen, many were facing sharply higher mortgage payments alongside double-digit inflation. While not directly a problem for tenants, unsustainable landlord finances are likely to make it harder to find somewhere to rent in the future.
4. Longer term other factors may matter more: While rent caps may shelter tenants in the short term, the design of tenancies may alter the dynamics of rent increases longer term. Evidence suggests that rolling rather than fixed term contracts tend to mean fewer, but larger, rent increases for tenants.
5. Price controls do not build homes: Rent caps treat the symptom of high housing costs rather than the cause. Suppressing in-tenancy rents can worsen supply pressures if private and institutional capital is diverted elsewhere. While rent controls were not the only factor at play, the share of homes bought by a landlord in Scotland fell by a more than a quarter between the initial introduction and final relaxation of controls.