Fife councillors have decided to allow no new HMO licences in St Andrews.
The permits are required for houses of multiple occupancy and apply when three or more people who are unrelated share a home.
HMOs are mostly used for students living – 86 per cent of current HMO licenses are located in the town.
At the community and housing committee on Thursday, councillors agreed to sanction no more, adotping a zero per cent HMO increase policy for the area.
Fife is the third local authority in Scotland to implement a cap, after Stirling and Dundee.
A report showed that there are 6861 homes in St Andrews and around 15 per cent were HMO licenced, with an average of 6.7 persons per home.
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Exceptions will still be made to the policy, including applications already being processed or for the renewal of HMOs and purpose built student accommodation.
An call to exempt homes in the conservation area that would allow locked bedrooms to be freed up was rejected by councillors who feared it would create a loophole.
A report from University of St Andrews that showed around 145 bedrooms could be freed up by this action, but the committee heard that requests to discuss it with the protcor went unanswered.
Local Councillor Brian Thompson appealed to collegues at the start of the meeting, saying: “I am firmly of the view that any further increase will impact the shortage of afforable housing in the town.
“Eight out of ten people consulted supported no new growth of licences.
“The locked room research was conducted by the university, which was an interested party. The survey results were biased on subjective responses by students.”
Councillor Linda Holt called the university’s report “shoddy”, saying: “It’s not been peer reviewed and was slipped in at the last minute to influence policy.”
But local councillor Jane-Ann Liston appealed that some allowance still be made in the area, saying that the cap wouldn’t free up more properties.
She said: “There are more expensive properties that lie empty all year.
“Poorer students will continue to have to commute from as far away as Edinburgh. The private halls are too expensive.”
However, Cllr Holt added: “I understand this isn’t a silver bullet that will solve all the housing problems in the area.
“But this policy will protect the properties that aren’t currently HMO for families who want to be a part of that community.”
Convener of the committee Judy Hamilton said: “This is historically a major issue for the town and the decision we’ve taken today will help to create a better balance between the different needs of the wider community.
“We will continue to work with the University to further explore all options for accommodation in the town that will meet the future needs of both students and residents.”
The councillors agreed the policy of no new HMO licences for St Andrews properties, and agreed to a review in three years time.