A major UK housing provider which has delivered new home developments in the country’s largest cities has said investors have been "forced to turn away from Scotland".

The senior national housing figure also said a key element of the planned new Scottish housing law that has raised concerns has been rejected in Wales because of the "detrimental effect on private renters".

Rent controls are to form part of the new Housing (Scotland) Bill currently going through the Scottish Parliament and have been backed by proponents including Living Rent, the tenants’ union.

James Blakey, a director at the Moda Group, known for its varied rental developments, said: "Scotland has huge potential for additional build-to-rent neighbourhoods and the success of our existing neighbourhoods at Moda, Holland Park and Casa, Vista Park in Glasgow, as well as Moda, The McEwan in Edinburgh, is testament to the demand for high quality, professionally managed rental accommodation.

"The introduction of rent controls over two years ago and the publication of the March 2024 Housing Bill saw residential investors forced to turn away from Scotland at a time when the demand for housing outstripped supply and major cities and the Scottish Government themselves declared housing emergencies.

"The unintended consequences of rent control were there for all to see."

Holland Park in GlasgowHolland Park in Glasgow (Image: Moda) He added: "Learning from the Scottish experience, the Welsh Government recently concluded in its Housing and Fair Rents White Paper (October 2024) that ‘rent control measures could have a detrimental effect on private renters, as it could lead to a reduction in the supply of rental properties in Wales, potentially increasing rental costs and in turn increase the risk of homelessness’."

Mr Blakey was giving his opinion in a new report this week, published by Scottish property company Rettie, which pointed to 14,000 new homes at risk of not being delivered in Scotland amid concerns of a lack of clarity around future investment.

Most recently, Moda Living achieved practical completion in August on its Holland Park development in Glasgow, with all of the first phase of the 433-home neighbourhood pre-let.

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Sandy Gilmour, associate director at Rettie, said: "Affordable housing is largely delivered through a system of grant funding for Registered Social Landlords, but the delivery of this stock has been threatened by build cost inflation and the cuts by the Scottish Government to its Affordable Housing Building Supply Programme.

"The consequence of these delays, policies and uncertainties has meant fewer affordable housing completions, and a number of business failures within the construction sector."

Paul McLennan, housing minister, told this column: "The Housing (Scotland) Bill will support people to stay in their homes and provide earlier intervention to prevent homelessness.

"We want to see a private rented sector that works for tenants while increasing investment in the sector.

"Our proposals for a long-term rent control will provide greater certainty around costs for private tenants in areas where rent control applies.

"The Housing Bill also places a stronger emphasis on preventing homelessness from happening in the first place. This includes relevant bodies working together to provide joined up support earlier to help people avoid the crisis of homelessness.”

The Scottish Government also said it will "bring forward a consultation in spring 2025 to support developing the detail of how rent control will be implemented, including consideration of how new housing built specifically for private rent – including in mid-market rent and other purpose-built private rented accommodation – should be treated".