The Land Reform (Scotland) Act was passed by the Scottish parliament at the end of 2025. It has brought in new rules regarding the sale of some land.
What does it mean for landowners and, potentially, local communities there and how will it work? Modus answers the questions that will be most relevant for chartered surveyors in the region.
What is the Land Reform (Scotland) Act 2025?
The Land Reform (Scotland) Act 2025 – LRSA – states that anyone wishing to sell a large land holding (1,000ha or more) must first offer it to local stakeholders. It sets out a series of steps that will allow people living on or around that land to make a community bid for all or part of it.
It also mandates that any large land holding (LLH) must be advertised before a sale or transfer of ownership to give local people the opportunity to bid for it, rather than changing ownership off-market.
What changes will it bring?
It is hoped that the legislation will increase transparency about land ownership in Scotland and also diversify its ownership.
Why was it implemented?
Scotland has one of the most extreme ratios of land ownership among developed countries: research by the campaigner and ex-member of Scottish Parliament, Andy Wightman, has concluded half of Scotland’s land belongs to just over 400 owners. (By comparison, England, albeit 60% bigger, has about 25,000 owners of half its land.)
Historically, a high proportion of Scotland’s rural land has been tied to great estates. This means that 1,000ha, while substantial, is not an unusually large parcel of land. Indeed, many much larger tracts have been sold or transferred in recent years to investors who see opportunities for growth through green initiatives and some favourable tax measures.
Other purchasers just love the romance of the Scottish countryside. The Danish fashion entrepreneur, Anders Holch Povlsen, has become Scotland’s largest landowner having bought 13 estates encompassing more than 210,000ha over the past 20 years. He has plans to rewild much of his land.
Another aim of the law is to publicise any land transfers, as many of the deals within these estates are conducted privately, often using opaque company structures. It is hoped that this element will lead to greater transparency and allow local communities or farmers the opportunity to make an offer.
The lighthouse and coastguard cottages at Arnish Point on the entrance to Stornoway harbour on the Isle of Lewis in Scotland
Has there been a precedent for community buyouts?
Yes. Scotland has had many community buyouts – about 850 altogether. Collectively, more than 210,000ha is now in community ownership. In 1923, crofters and residents of Stornoway, on the Outer Hebridean Isle of Lewis, were gifted 27,500ha of land by its owner, Lord Levenhulme, in what was seen as the first community takeover of land.
Famously, in 1997, residents on the tiny Hebridean Isle of Eigg – population at the time: 60 – managed to raise the £1.5m required to buy it from their absentee landlord and create a trust through which to control it. Its population is now more than 100; it has developed tourist facilities, renovated neglected homes and buildings on the island, and invested in its own renewable energy grid which has made residents energy self-sufficient.
Similarly, Knoydart, on a peninsula on Scotland’s West Coast, has been another success since it was bought by the community in 1999. (In 2022, locals succeeded in a further community buyout of the village pub, the most remote in Britain, requiring a two-day walk from the nearest road or a seven-mile ferry ride.) Like Eigg, Knoydart’s population has expanded since the buyout and locals have invested in housing, sustainable tourism and energy generation.
“Land agents and estate managers should be advising now on appropriate lotting to ensure responsible stewardship of the land” Jennifer Campbell MRICS, RICS Scotland Board
Do community buyouts always work?
There have been a handful of community buyouts, such as Isle of Gigha, which have faced financial difficulties after the purchase. There have also been cases of communities which have been unable to buy local land because they could not match the sums offered by private buyers.
This is one of the reasons that the LRSA has given communities the right of first refusal. Under the legislation, local people have an eight-month window (that can be extended) in which to raise the money. During this time, the land cannot be offered elsewhere.
How will the LRSA work?
Details have not been fully fleshed out but the first thing that LLH owners will have to do is provide a Land Management Plan (LMP) which outlines the ownership of the land and the vision for its usage. It details ways in which owners have engaged with locals and whether these views have been accounted for in the LMP. There will also be an emphasis on improving biodiversity and reducing carbon.
Any communities or individuals – such as farmers or crofters – who would like to buy part or all of an LLH, are able to register their interest whether or not that land is to be offered for sale. Their registration of interest lasts for five years and can be renewed.
Should the owner wish to sell or otherwise transfer an LLH, an application must be made to the Scottish government and, should it be decided that the land qualifies, anyone who has registered an interest will be contacted and has 30 days to come forward. Should a community group propose a purchase then the sale of the land on the open market will be paused for eight months to allow the group right to buy application to be examined – this can potentially be extended.
The LRSA will also create model leases for land tenants, give crofters greater powers and take more account of ‘lotting’ (more on that below).
But how will communities pay for the land?
The Scottish Land Fund was established in 2001, to help with community buyouts. It advises community groups and offers grants of up to £1m. There is, however, still a need for local communities to raise additional money – often using fundraising platforms or offering shares to local people who are able to contribute towards the purchase.
View of the Isle of Gigha, Scotland, UK
What happens if the community cannot afford the buyout?
“Because of the nature of land holdings in Scotland, values will often be millions or tens of millions of pounds,” says James MacKessack-Leitch of the Scottish Land Commission (SLC), which advises the Scottish government on land matters. Even a £1m grant, therefore, will not be enough to purchase some land.
Supporters of the LRSA hope that landowners will be prepared to negotiate with communities to reach an agreement. By designating a proportion of the land – known as lotting – which might be transferred to the community, the rest of the holding can be sold on the open market.
“Land agents and estate managers should be advising now on appropriate lotting to reach a wider audience and ensure responsible stewardship of the land, while ensuring market value is not compromised,” says Jennifer Campbell MRICS, a member of the RICS Scotland Board.
“Because of the nature of land holdings in Scotland, values will often be millions or tens of millions of pounds” James MacKessack-Leitch, Scottish Land Commission
What are the advantages?
The most obvious advantages are to local people who have often felt cut off from ownership. They may now have the opportunity to buy and thus control the land upon which their lives and livelihoods often depend. “If you have a fairly remote estate which owns the housing, the pub, the shop, the hotel where the villagers work, you can see how that has an impact on the local community,” says MacKessack-Leitch.
It should also help to diversify the range and number of landowners in rural Scotland, which some people feel could reinvigorate the countryside and offer new opportunities in terms of the social make-up, employment, housing and infrastructure.
The reforms could address a supply problem – namely a continuing decline in land available to rent and the difficulty new farmers have accessing land and getting a foothold in farming. A healthy tenanted sector ultimately depends on landlords continuing to find it worthwhile to let their land.
Part 2 of the Act attempts to rebalance the relationship between landlords and tenants. A new ‘land-use tenancy’ to encourage diversification into woodland, renewables and flood management; more generous compensation where a landlord resumes possession of leased land; and clearer rules on rent reviews are all intended to make letting more attractive while giving tenants the security to invest.
Are there any drawbacks?
Some landowners are said to be concerned about the uncertainty surrounding the LRSA which will require a great deal of secondary legislation to clarify aspects of the process and obligations. “Change will always affect investment markets so it’s vital that the secondary legislation provides prompt reassurance to landowners and communities,” says Campbell.
