Student accommodation in Scotland - the Housing Act and more

Student accommodation hit the headlines in Scotland last year with its inclusion and then removal from rent controls in the Housing (Scotland) Act 2025. The Housing Act did eventually deal with the right to end student tenancies. Discussions on how this right will operate and other discussions on model terms and conditions are ongoing.

The Housing Act and student accommodation

The Scottish Housing Act provides for rent controls on increases in rent under private residential tenancies (PRTs), the main type of residential tenancy for private rented property in Scotland. Rent increases for new and existing PRTs in rent control areas will be capped at CPI +1% (up to a maximum increase of 6%).

Rent controls will apply only in rent control areas (RCAs) as designated by local authorities and approved by the Scottish Ministers. An RCA could be the whole area under the jurisdiction of a local authority or only parts of areas. There will also be categories of properties exempted from rent controls including BTR and MMR properties.

Student halls of residence and purpose-built student accommodation (PBSA) tenancies were brought within the ambit of rent controls during the passage of the Housing Act through the Scottish Parliament. However, the Scottish Government recognised that student tenancies operate in a very different manner from PRTs and successfully tabled an amendment to remove student accommodation from rent controls at the final stage of the Bill.

And so, rent controls will not apply to student accommodation provided by educational institutions and PBSA providers with planning permission requiring the accommodation to be used predominantly for housing students and comprising at least 30 bedrooms. This is regardless of whether the student accommodation is located in an RCA or not.

Rent controls will apply to other properties such as the traditional HMO accommodation used by students if these properties are situated in an RCA.

The right to terminate student tenancies

Whilst most student accommodation will not be subject to rent controls, the Housing Act has provided for the introduction of a right to allow students to end their student tenancies on 28 days’ notice. Following stakeholder engagement, the Scottish Government has confirmed that any such right will be in line with current best practice of the major student accommodation providers and limited to specific circumstances such as family bereavement or leaving to study in a different city. Indeed, the Cabinet Secretary during the debate in the then Housing Bill acknowledged that allowing [termination of student tenancies] in all circumstances could have a significant impact on the management of, investment in and supply of student accommodation in Scotland. Specifying the circumstances in which a student may end their tenancy, … would ensure that that could occur only where it was appropriate for them to do so.

The major student accommodation providers already operate a system allowing students to end their tenancy in such circumstances and do not anticipate issues with the introduction of the new right. Scottish Government must consult landlords and tenants with an interest in the termination right before passing the regulations needed to implement the right. Those talks have been taking place and the next step will be a public consultation on the terms of the new right which is expected in June. The regulations implementing the new right are unlikely to be in place until autumn 2026 at the earliest.

The PBSA Review Group

The Scottish Government commissioned research into PBSA which was published back in December 2022. A cross sectoral Review Group was subsequently formed but to date, their recommendations* have only appeared in an answer to an MSP question in the Scottish Parliament.

During the debate on the Scottish Housing Bill, the Scottish Government was criticised for dragging its heels in implementing the recommendations laid at their door by the Review Group. In response, the Cabinet Secretary confirmed that the work on producing model terms and conditions for student tenancies and a complaints procedure for student tenants was well advanced. There will also be guidance for student tenants on the terms and conditions and their rights under their tenancy agreements.

Planning and PBSA

Planners (or politicians) in Glasgow and Edinburgh have at times had a troubled relationship with student accommodation. However, the introduction of detailed guidance on PBSA development by Glasgow City Council has helped to smooth the process through increased transparency around the planners’ requirements leading to greater certainty for applicants and other stakeholders.

While experience in the east has perhaps been more challenging, recent appeal cases which have tested the planning policy position in Edinburgh may help to provide more predictable decision making going forward. The City of Edinburgh Council also sensibly rejected a proposal for a moratorium on student accommodation.

Despite bumps along the road, both cities have seen a steady flow of consents being granted, for much needed student development in both cities.

There are currently many applications to develop PBSA making their way through the planning system, particularly in Glasgow and Edinburgh but it remains to be seen which proposals will reach the development stage. It may be that some of them resulted in a pivot away from Build to Rent proposals when rent controls were on the horizon. The recent publication of regulations exempting BTR properties from rent controls may see that trend reversed if viability challenges can be overcome.

There is also growing support for co-living which may be another option for some students. Glasgow City Council, initially hesitant about the concept, has now granted its first co-living consents having adopted detailed planning guidance to assist applicants and officers.

PBSA going forward

Affordability is now more important to more students than ever before. The number of foreign students coming to Scotland has dropped and at the same time, foreign demand for the high-end product has also levelled off. The cost of living crisis also restricts the finances of students and the bank of Mum and Dad based in the UK. The affordability demand coupled with the rising funding and construction costs faced by developers strike at the viability of projects. The question may be whether demand for more student beds can be fulfilled by the refurbishing and upgrading of existing stock or by turning to other types of living accommodation such as the student hotel model, BTR or co-living.

*Recommendations of the PBSA Review Group

1. That the Scottish Government works with partners to develop a Model Terms and Conditions to apply across all PBSA, both institutionally and privately operated.
2. That the Scottish Government consults widely on the scope to legislate on PBSA regulation, specifically in respect of notice periods and cooling off period for PBSA tenants, including identifying what circumstances should apply in such cases and potential impact on investment and rent levels.
3. That Higher Education Institutions work with partners to develop and distribute information packs for student tenants in both institutional and private PBSA properties, outlining the existing routes for progressing complaints and redress, including through the SPSO and the First-Tier Tribunals system. These information packs should contain clear links to regularly updated relevant online content.
4. That the Scottish Government works with partners to scope the development of a Model Complaints Procedure to be adopted across all types of PBSA.
5. That the Scottish Government convenes a national round table discussion with HEIs, private PBSA providers, investors/developers, students, and local authorities, to explore improvements in relation to ensuring the housing needs of students are met.
6. That strategic partnerships be established at local level, involving all those involved in provision / use of student accommodation to consider / address supply issues at local level in the short, medium, and long-term.
7. That the Scottish Government works with partners to identify and address barriers to expanding the supply of affordable accommodation for students through e.g. the repurposing of existing buildings and the utilisation of alternative housing models e.g. housing co-operatives.
8. That the Scottish Government and Higher Education Institutions actively engage with property investors/developers in the private sector to encourage the development of a more diverse range of student accommodation properties, which could meet the needs of families and those on lower incomes.
9. That Higher Education Institutions and providers of private PBSA work more closely together to ensure students get the information they need, including consideration of data sharing agreements.
10. That Higher Education Institutions provide to all tenants residing in University or privately-run PBSA information on student support available through institutions, and how to access this. This should be available in formats other than online, and frontline staff working within all types of PBSA should have ready access to this information in order to provide advice when needed.
11. That the Scottish Government engages with Home Office on the provision of student dependents’ data for international students taking up places at Scottish universities.