Private rented sector not reason for fewer Scottish homeowners, agent claims

A leading agent has called on the Scottish government to reduce property taxes rather than freezing rents if it wants to help more first-time buyers.

DJ Alexander Ltd, which is the largest lettings and estate agency in Scotland and is part of the Lomond Group, has criticised arguments from the Scottish Government that that if there was no private rented sector (PRS) then more houses would be available for tenants to buy.

The agent’s chief executive David Alexander, said the growth of the PRS in Scotland has coincided with the decline in volume of social housing in the country.

In December 2000 63.4% of Scots were homeowners with 29.9% in social housing and just 6.7% in the private rented sector, according to government data analysed by DJ Alexander.

By 2019, the latest year for which directly comparable statistics are available due to the pandemic, the number of homeowners in Scotland was 59.1% with social housing on 22.8% and the PRS at 14.3%.

Alexander said: “It should also be noted that if the Scottish Government wants to encourage first time buyers, they could start by reducing the taxes levied on purchases. 

“Scotland is the most expensively taxed part of the UK for first time buyers with property taxes starting at £175,000 compared to £300,000 in England. Matching the figure south of the border would help reduce the costs for first time buyers.

“Removing stock from the rental market does not answer the key housing problems which Scotland faces. Decades of under investment in social housing has resulted in record waiting lists and an enormous housing shortage across Scotland.”