The removal of no fault grounds for repossession and the spectre of rent controls in city hotspots will result in an exodus of landlords from the Scottish private rented sector (PRS), new research has suggested.

Figures from lettings portal Citylets, revealed that over 31 per cent of Scottish urban landlords are set to leave the PRS or reduce their portfolios after the decision to remove no fault grounds for repossession.

An even greater 39 per cent of Scottish urban landlords say they are likely to leave the PRS or reduce their portfolios should rent controls be introduced in City hotspots. Only 23 per cent said their sentiment toward remaining a landlord now and in the future would remain fully unchanged.

Figures rise higher still amongst landlords with larger portfolios of more than five properties. Around 43 per cent said they will leave altogether or reduce portfolio in light of no fault removal and 54 per cent in the event rent controls are confirmed.

Commenting on the findings, Thomas Ashdown, founder of Citylets, said: “We felt the response form to the current consultation missed the opportunity to ask landlords a few straightforward questions in relation to their appetite to remain in the sector in light of changes confirmed and proposed.

“Our findings must be of concern to all stakeholders to the debate. I no longer see how it is possible to contend that the current plans are consistent with the oft stated aim to see the PRS made better without deterring investment and threatening supply. Even allowing for some cooling off of sentiment, the findings are clear.

“Citylets is not a political or representative body with the intent our research can find resonance in all quarters. We hope this will pay dividends today more than ever- nobody wants to see supply worsening in the Scottish PRS.

“There is clear inevitability of unintended consequences to what is being proposed. This seems set to exacerbate the housing crisis and create more homelessness, not less.”

The key findings of the Citylets Landlord Survey were:

Over 50 per cent of landlords polled have been in the sector for over ten years. Landlords were in the majority agreeable to being bound to rent rises only once a year with 12 weeks’ notice and also tenants having access to recourse in relation to those rent rises.

Landlords were, however, in the majority not agreeable to longer notice periods for repossession.

Invited to express one thing to policy makers the dominant sentiment was that the tenancy regime was becomingly increasingly unbalanced towards tenants.

“Interestingly” observed Ashdown, “everybody took the trouble to offer qualified statements and not a single respondent offered profanity. I think that’s noteworthy of a group 73 per cent of which feels no less than vilified and speaks volumes about the calibre of the vast majority of individuals in the sector.

“As an absolute minimum, the Citylets Landlord Survey surely represents a mandate for policy makers to explore the issue of landlord exodus in more detail and build on the work we have begun.”

Ashdown also cited the long standing Scottish hotspot of Aberdeen, where rents are now falling and likely to continue a downward trend throughout 2015, as a classic example of a market self correcting given appropriate breathing space. However he warned that Edinburgh on current trajectory was likely to replace Aberdeen and was not excessively susceptible to a downturn in any single economic sector.