Landlords’ Challenges in the Glasgow Rental Market

Opposite to popular assumption, the vast majority of landlords do not want to ‘get’ tenants. Quite the opposite is true. This article tries to shed light on the current issues faced by landlords in the Glasgow rental market. As a letting agency in Glasgow, we can offer a unique perspective on current market trends.

Effects of Scottish Government Regulations on Scottish Landlords

Glasgow’s cost-of-living issue has left tenants vulnerable, exacerbated by a property market that cannot meet demand. The Scottish government will continue working together with key stakeholders from landlord and tenant groups as it develops a tailored response to the crisis that meets Scotland’s specific requirements.

The Scottish Government, in our opinion, created these “specific requirements”. The abrupt implementation of the 2022 Cost of Living Tenant Protection Scotland Act in September 2022, which capped rent increases at 3% and imposed an eviction ban until March 31, 2023 (Later extended to March 31, 2024), has raised concerns in the landlord community. In practice, they interrupted day-to-day letting activities and raised rental prices for new-to-market housing.

What exactly are Scotland’s rent increase regulations?

Currently, the 2022 Cost of Living Tenant Protection Scotland Act requires a rent increase of 3% of the current rate, impacting the rental market in Glasgow. In some situations, landlords might request a 6% increase if they can demonstrate a significant increase in mandated costs, primarily mortgage payments. Rents can be raised once every twelve months.

How a Glasgow landlord is experiencing trouble with funds

Each landlord’s situation is different, depending on loan conditions and personal circumstances in the private rental sector. However, here’s an actual example of a Glasgow rental house available on the property market. The landlord’s monthly mortgage repayment has grown by 98% this year, but they have only received a 6% rent increase after applying to the Rent Officer. The data speaks for itself.

The rights of renters are the primary focus of this legislation, but what about the rights of landlords? It’s evident that some landlords in Glasgow are finding it difficult to make ends meet due to a significant increase in costs. The Scottish Government must adopt a somewhat balanced strategy in order to effectively solve the existing problems in the property market.

Is the Glasgow rental market lacking in rental properties?

The simple answer is yes. The last thing this industry needs is another shortage of rental property in Glasgow, which is exactly what this new legislation is causing. Due to a shortage of available rental houses in Glasgow, demand for them remains strong.

Investing in the Glasgow Rental Market: Is now a good time?

Although some landlords exit the rental market, Glasgow continues to see a steady influx of investment from both local and international investors attracted to the city’s lower pricing and greater yields when compared to other major UK cities. Smart investors are adding some wonderful homes to their portfolios as property prices gradually adjust after years of persistent interest rate increases. The scarcity of rental stock, along with the fact that new-to-market rental properties can be priced properly for current market conditions, creates some excellent investment opportunities.

Do you have challenges in the Glasgow rental market? Western Lettings can help!

As a landlord, navigating the rental market can be difficult, but you do not have to do so alone. Western Lettings Glasgow is here to help you get past any obstacles. We’ve got you covered on everything from locating reliable tenants to handling property maintenance.

Call us now at 0141 357 0436 to solve your landlord problems!