Next Scottish Government Urged to Support Landlords Amidst Investor Confidence Concerns

Why This Matters to Scottish Landlords

The private rented sector (PRS) in Scotland is a crucial part of the housing market, providing homes for over 600,000 tenants. However, recent years have seen a decline in investor confidence, partly due to the lack of a clear government strategy recognising and supporting the PRS. The Scottish Association of Landlords (SAL) has made this a central theme in its 2026 manifesto, urging the next Scottish Government to take decisive action.

Key SAL Manifesto Asks and Their Implications

SAL's manifesto highlights three main reform areas:

• Abolition of the Land and Buildings Transaction Tax (LBTT) Additional Dwelling Supplement (ADS): Currently, the ADS adds 4% on top of the LBTT for additional properties, increasing acquisition costs for landlords expanding portfolios or replacing properties. Removing it could improve investment viability, particularly for portfolio and accidental landlords.

• Reform of Tenement Law: Scotland's unique tenement structures create complex legal challenges around maintenance and shared responsibilities. SAL advocates for reforms to simplify and clarify these obligations, potentially reducing disputes and management burdens for landlords operating HMOs or flats within tenements.

• Closer Collaboration Between Scottish and UK Governments: SAL calls for aligned policies recognising the cross-jurisdictional nature of housing investment and regulation, aiming to reduce conflicting rules that can deter investors.

Practical Impact on Different Landlord Profiles

• Single-Unit Landlords: May benefit from simplified tenement law reforms, easing management responsibilities and reducing legal risks.

• HMO Operators and Portfolio Landlords: The abolition of the ADS could lower acquisition costs, improving portfolio growth prospects. Monitoring tax reform progress remains essential for financial planning.

• Accidental Landlords: Often deterred by rising tax burdens and complex regulations, might find renewed confidence if the ADS is abolished and tenancy laws clarified.

What Landlords Should Do Now

1. Monitor Political Developments: With the 2026 Scottish Parliament election approaching, closely track policy announcements related to landlord taxation and tenancy law through SAL updates and official government sources.

2. Engage with Landlord Associations: Joining or maintaining membership in groups like SAL ensures access to advocacy efforts, expert guidance, and timely regulatory updates.

3. Review Portfolio Strategy: Consider how potential abolition of the ADS and tenement law reforms could affect acquisition or disposal plans. Prepare financial scenarios with and without these changes.

4. Communicate Proactively with Tenants: Maintain clear communication about any operational changes or compliance updates as policies evolve.

5. Plan for Compliance Audits: Anticipate new compliance requirements from reforms. Scheduling an audit now can identify improvement areas and reduce risk.

How Rentals & Sales Can Support

Our team offers tailored portfolio reviews and compliance audits to help landlords navigate regulatory changes. We provide up-to-date pricing strategies reflecting market shifts and tax changes, ensuring investments remain competitive and compliant.

Contact us to arrange a consultation focused on preparing your portfolio for the evolving Scottish PRS environment.

Disclaimer: This article provides general information and should not be construed as legal or tax advice. Landlords should consult qualified professionals regarding individual circumstances.