SIR Tom Hunter has issued a warning over the “unintended consequences” of the Scottish Government’s rent freeze in the private housing market, declaring that it will worsen the well-documented shortage of homes across Scotland and drive prices up.
Scottish minsters introduced a temporary cap, set at zero per cent, on in-tenancy rent increases in October to help people with the cost-of-living crisis. The cap will remain in place until at least March 31, 2023.
But, speaking to The Herald this morning, leading Scottish entrepreneur Sir Tom Hunter warned the policy would be damaging in the long run.
Sir Tom, whose West Coast Capital vehicle is developing the Winchburgh village in West Lothian, said: “We do need to address some of the structural nature [of housing policy]. The Scottish Government came out with a rent freeze which on the face of it looks good for the people who are not paying more money. But it stifles supply, basically. I personally know of two big schemes in Scotland that are just not going ahead until there is future clarity about what is going to happen in the rental market. So, there are some big decisions to make about housing.”
Sir Tom added that while it is positive that tenants benefit from a rent freeze, there are “unintended consequences of cutting off supply”.
He said: "In the longer run it makes things worse because if there is less supply coming into the market and more demand… prices skyrocket. There needs to be long-term thinking here and not just one-sided thinking.”
Sir Tom’s remarks came as new accounts for West Coast Capital show it had total assets, less current liabilities, of £185.3 million at March 31, 2022, compared with £195.7m at the same stage last year.
The period saw the company make further progress at Winchburgh with joint venture partner CALA, with work under way to deliver three new schools, a 75-acre community park and a marina at the village.
West Coast Capital invested in a “significant position” in Ayrshire-based hospitality group Buzzworks Holdings, and disposed of its position in Calum Smeaton’s TVSquared, which was sold to Innovid in a deal worth $160m.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel