Our Autumn Report exposes a worrying lack of supply in the Scottish PRS.
Lettingweb’s Autumn Report reveals the largest discrepancy between homes being rented and new properties coming onto the market since records began. In November alone, well over 2,000 fewer properties were advertised than were rented.
In further evidence of the increased demand, the time taken to let a property is falling. Between September and November, over 25% of all advertised properties were rented within one week of being advertised; almost two-thirds were rented within one month.
Lettingweb believe that future reports will provide more clarity but that the apparent supply crisis could be part of a long-term trend: a lack of rental properties coming on stream to cope with the huge growth of the private rented sector which in turn pushes up prices.
Homes for Scotland, the Federation of Master Builders Scotland and LetScotland – the Association of Professional Letting Agents in Scotland, have commented on the findings.
Steve Tigar, Managing Director of Lettingweb, says:
“These are stark figures of the like we haven’t seen before. Renting privately is an increasingly popular choice for people in Scotland – sometimes out of necessity as a result of mortgage restrictions introduced after the banking crisis, but often as a lifestyle choice.
“The booming market for rental property is further confirmed by a rise of 22% in enquiries about properties through Lettingweb.com. This change cements our view that something very significant is happening.
“The flexibility of renting privately on relatively short-term leases which can be continued for many years, combined with the high quality of rental property available, makes renting an increasingly attractive option. This is true not just for the perceived core markets of students and young professionals, but also for families.
“However, we are seeing increasing evidence that the supply of rented accommodation simply isn’t there to meet this rising demand. This is a significant structural problem in the housing market and one that we would encourage all stakeholders including politicians, town planners, mortgage providers and house-builders to consider.”
Philip Hogg, Chief Executive of home building industry body Homes for Scotland, says:
“With official figures estimating that Scotland requires 465,000 new homes by 2035 in order to meet housing needs but current build rates pointing to a shortfall of around 160,000 on this figure, Scotland is a country with urgent yet diverse housing needs.
“The growing rented sector clearly has an important role to play in achieving a balanced tenure mix. It also offers new and significant opportunities for investment and development together with the wider social, environmental and economic benefits the construction of new homes brings. Recommendations from a major research project we undertook this year on how to expand the sector include the appointment of a Rented Sector Champion and the need for stability in the policy, taxation and regulatory environments.”
Grahame Barn, Director of the Federation of Master Builders Scotland, a trade association representing the SME building industry, says:
“Scotland is in the midst of a housing crisis – annually we are building and restoring thousands fewer homes than we need. The status quo is unacceptable. Too many families are living in inadequate housing conditions or are struggling to find accommodation.”
Malcolm Warrack, Chairman of LetScotland, the Association of Professional Letting Agents in Scotland, says:
“The majority of our members are reporting a very buoyant market and there seems little doubt that renting is becoming an increasingly popular choice for all sorts of people. The time we are taking to rent properties to our tenants is falling, and that’s always a sign of the sort of low supply, high demand situation which Lettingweb are reporting.”