Shifts in the market could be the cause of a period of turbulence across Scotland’s rental sector, but Edinburgh’s strong performance could be its saviour.
Edinburgh is Scotland’s second most expensive city to rent in according to Lettingweb’s October Report. That may come as no surprise to most – Aberdeen’s boom has been reported for some time – but the future of lets in the capital looks more uncertain now than it has since the credit crunch five years ago.
Demand for flats in Edinburgh has been high for a long time – over 70% of one- and two-bedroom properties are let within a month, the second most for any city in Scotland. But flats in the city were available for two days less this summer than in the previous one, and whilst that increase has been seen every year for some time, it has become even more marked in 2013.
More worrying than the increase in demand for rental properties for those living in Edinburgh is the drop in properties available to let, which are scarcer than in previous years. In September, the number of properties available to let on Lettingweb was at the lowest point it has been for fifteen months, having dwindled in the face of increased demand for most of the year. The picture looks far different to what has gone before, where demand and supply were matched for long periods.
Unfortunately, the increase in demand and drop in available flats is replicated across the UK. But Edinburgh’s inhabitants, having long suffered high rents, may soon find that those higher rents come to their rescue. The growth in how much it costs to rent in Edinburgh outstripped most of Scotland this summer with two- and three-bed flats in particular rising 4% and 5% respectively.
That trend, having continued steadily for several years, makes Edinburgh’s rental market far more robust than elsewhere in the country. In a time when investors and new landlords are needed more than ever, it is Edinburgh’s rental stability that could give it the edge over Glasgow.
Edinburgh rental stats
According to Lettingweb:
- There were 2.49% more properties let in August that came onto the market, and 31.5% more in September.
- Rents in Edinburgh rose 2.5% for one-bed flats, 4.1% for two-bed flats and 5.4% for three-bed flats this summer compared to last.
- Average rents for one-bed flats were £572 for Edinburgh this summer, compared to £498 in Scotland as a whole (+14.9%).
- Average rents for two-bed flats were £748 for Edinburgh this summer, compared to £626 in Scotland as a whole (+19.4%).
- Average rents for three-bed flats were £1018 for Edinburgh this summer, compared to £862 in Scotland as a whole (+18.1%).
For full insight into the lettings market across Scotland, download Lettingweb’s Lettingstats Report – October Edition here.
Figure 1: Demand rises in Edinburgh over the past 3 years