As Scotland approaches the 7 May 2026 election, key changes are expected across planning, tax and housing.

Published: 13 February 2026
Author: Sheelagh Cooley

With the Scottish Parliament entering its final months before the 7 May 2026 election, the real estate sector is entering a critical phase of policy transition. From energy performance reforms and housing delivery initiatives to tax changes and planning updates, several significant changes are set to emerge. Below is a round up of the key issues to watch as the current parliamentary session draws to a close.

EPC reform & draft Heat Bill

The Scottish Government intends to replace the current EPC framework through the proposed Energy Performance of Buildings (Scotland) Regulations 2025, expected to take effect on 31 October 2026. The new regime will introduce a heat retention rating in place of the existing energy efficiency metric and will reduce EPC validity to five years.

Transitional arrangements are anticipated: EPCs for properties marketed for sale or rent before 31 October 2026 are expected to remain valid for one year after the new rules come into force. Further measures – including minimum EPC standards for the private rented sector – are also being developed, reflecting the continued drive to decarbonise Scotland’s building stock.

Housing agency

The Scottish Government has announced plans to establish ‘More Homes Scotland’, a new national housing agency focused on achieving “simplicity, scale and speed” in accelerating housing delivery across all tenures. Expected to begin operating in 2027–28, the agency will focus on large‑scale affordable housing, rural and island needs, land assembly, and enabling infrastructure to unlock stalled sites. It will be co‑designed with local authorities and the Scottish National Investment Bank, with an update to Parliament due in March.

Land and Buildings Transaction Tax (LBTT)

News from the recent Scottish Budget 26/27:

• rates and thresholds remain unchanged for residential and non-residential, including additional dwelling supplement and first-time buyer relief
• if parliament approves the draft regulations, there will be relief for investors participating in Co-ownership Authorised Contractual Schemes to take effect from April 2026
• progress on amending LBTT policy for Reserved Investor Funds and Seeding Relief is paused until after the election
• LBTT reform to continue after the election.

Planning

The Scottish Government’s consultation on reform for compulsory purchase orders (CPOs) closed in December 2025. With a fair wind, a summary of responses is expected in Q1 2026 and a draft bill in the new parliamentary session. For detail see Planning Partner, Steven Stewart’s comments in Reform of Compulsory Purchase Orders is coming down the line (first published in The Scotsman).

Meanwhile, Planning Circular 4/2025 was published in December 2025. It updates Circular 3/2012, reflects the changing planning environment and practices developed since 2012 and has generally been well received. For more detail see: A welcome update for planning obligations in Scotland

Residential rent controls in terms of the Housing (Scotland) Act 2025

Following on from its analysis of the responses to the consultation on exemptions from rent controls, the Scottish Government has published draft regulations paving the way for mid-market rent and build to rent properties to be exempt. If passed by the Scottish Parliament, the regulations will take effect on 1 April 2026.

Student accommodation (PBSA)

The Housing (Scotland) Act 2025 gives the Scottish Government power to introduce, after consultation, regulations for early termination of PBSA tenancies by students. The draft regulations have not yet been published but are expected to be tightly drawn and based on industry best practice, with a 28-day notice period and specified grounds such as illness, bereavement, or moving to another university.

Scottish Building Safety Levy (SBSL)

In its Budget for 26/27, the Scottish Government confirmed its commitment to introduce the SBSL on 1 April 2028. No transition period is expected and we will be watching out for the levy rates which are to be published in June 2026 (after the election). For detail see Scottish Building Safety Levy and what it means for residential development.

Visitor levy

The enabling legislation is in force and it is now up to each Council to decide if/how they introduce a levy.  Edinburgh is the first with a 5% levy applying for stays on or after 24 July 2026. For more detail see Visit Scotland. It is also worth noting that, in addition to the existing structure, the Scottish Government has recently introduced draft amending legislation to give Councils greater flexibility over the design and implementation of the levy.

Together, these reforms signal a period of significant transition for Scotland’s real estate market. While some measures remain subject to parliamentary timetables, others are already set on a clear path beyond the election cycle. For investors, developers, and operators, early awareness of these shifts will be essential to planning ahead. If you would like to explore what these changes mean for you, please contact Shoosmiths’ Scotland Real Estate Team.