Scottish letting agents give us their views on their local market.
“With a lack of supply in the city we continue to see an increase in the rentals achieved and I do not foresee this changing over the historically busy summer market. With a range of different people moving to the area, including international students, public sector and professionals, we are finding all types of properties are in high demand. Whilst the Scottish Government continue to introduce more legislation encouraging landlords to exit the market, the current difficulties for tenants to secure properties will not be resolved in the near future.”
“Activity in the Edinburgh market remains extremely high, and this, coupled with continued low stock levels means feverish levels of competition for advertised properties amongst tenants. We expect the supply demand imbalance to remain in place, which will mean upward pressure on rents in the capital is likely to persist until either the lack of stock is eased or cost of living pressures constrain affordability. The student market in Edinburgh also mirrors that of the wider PRS, in that the number of traditional HMO flats across the city has reduced significantly, while demand has increased. The result is increased levels of competition amongst the student population to secure accommodation for the next academic year.”
“The effects of recent legislative, economic and tax changes are beginning to be seen on the ground, with tenant demand soaring due to some landlords deciding to quit the market as margins thin and in some cases turn negative. Demand for rental property from tenants is once again soaring, with supply levels unable to keep up. Therefore, rents are rising at a staggering rate compounding the already difficult market for tenants. The Scottish Government were warned of this consequence prior to the introduction of the Cost of Living (Tenant Protection) (Scotland) Act, which has had the opposite effect by making the situation even more difficult for tenants.”
“June’s rental market has been busy with quick turn arounds on properties across the board. Increasing mortgage rates are hitting landlords hard and rent caps mean that a change in tenancy is the only chance they have to try and catch up with costs, so there is a lot of pressure to increase rents on the open market. Short supply means tenants have to pay the higher rents and we’re seeing several offers for many properties. After several years of decline, the Aberdeen rental market is finally gaining ground, but will it be enough for some landlords?”
“Supply and demand is again hugely relevant as we head into the busy summer months. Simply, we don’t have the number of properties required. The need for encouraging serious landlord investment is massive. Rents are rising across the city, time to let and voids are low, with tenants prepared to pay over two properties just to secure a new let, despite the cost of living crisis, showing desperation and urgency. Added pressures include landlords exiting the market due to rising financing costs and less flexibility, a growing and ageing population, lack of affordable new development and now the recent U-turn on short let regulations; holiday let properties plugging the gap in the long term market is looking less likely. Renting in this wonderful city will be an expensive and challenging prospect for the foreseeable future.”
“Q2 has seen the start of usual trend of move outs for summer, particularly student tenancies, and this is leading more landlords to now consider their options with the current financial climate and look at selling up and leaving the PRS altogether with further legislation changes (and costs) looming in 2025 for EPCs too. Rental prices continue to increase due to the continued lack of supply and increased demand has been demonstrated with some properties being let quickly, which will be welcome news to landlords investing longer term. We anticipate a busy summer equal to last year into Q3, with the real challenge being how to accommodate everyone.”
“The rent increase capacity has allowed fractional rent increases from July, but is a far cry from the real increase in landlord costs. That said, rents continue to go up between tenancies and record highs continue. TTLs remain exceptionally low with no sign of that changing, given the demand. Some landlords are exiting the PRS now, but it’s a small percentage and the long-term effects remain to be seen. I get a sense, it will not be as positive for tenants as has been the government’s intention. It will be interesting to see how this plays out. Onward to Q3!”
“We observed a 30% increase in checkouts in April and May, triggered by tenants serving notice. The main drive behind this was tenants seeking more energy efficient properties. Clearly the increase of living costs is having a real effect on the rental market. This rise in checkouts helped to increase the stock of properties on the market temporarily. June showed a return to the norm. Long gone are the days when just the appearance of the property made the property lettable. A good EPC rating is climbing up in the priority list of tenants.”
“This period seems very much like the calm before the storm as the savvy tenants are securing properties prior to the mad rush that will no doubt ensue in the coming months. There has never been such a lack of stock and with huge demand imminent, it is surely going to push rental levels to a hyper inflated level. Prime areas are very much in demand but we are seeing some applicants willing to travel as rental prices force them to consider outlying areas. There is no sign of this slowing down until the Scottish Government and Patrick Harvie decide to engage with key stakeholders and realise what absolute devastation they have created in the PRS.”
“We await publication of the government’s draft Bill later this year which will address the detail proposed under the heading a new deal for tenants; the deal for landlords, however, looks increasingly uncertain. New rental properties are getting less plentiful as a consequence but there does seem to be more movement of existing stock, as landlords go in search of higher levels of service and advice from their provider. Rents in the capital continue to rise which is a natural consequence of the shortages and enquiries for one and two bed flats in good locations are off the scale.”
“The frenzied market of recent summers is repeating. Returning students are starting their property search earlier, driven by the memory of their struggles in recent academic years. Landlords are increasingly keen to push rents up on incumbent tenants as they roll off their fixed rate mortgage deals. Most landlords now realise that their one chance to increase rents to market levels is when they have a change of tenant. The rent freeze has turbo-charged rent inflation, as well as brought with it the usual array of unintended consequences.”
“The rental market in Edinburgh remains strong with tenant demand not abating. There is still a declining supply of properties coming to market. We are seeing landlords moving abroad for a couple of years and looking to rent the family home with a view to returning, therefore limiting longer term stock. The increase of ADS to 6% stopped many potential landlords taking the plunge. Students still struggling to find HMO’s due to lack of supply, with students staying put again for the 2nd year running. We are in a crisis state of having more demand than supply; leading to rising rents, now hitting double digits across the main cities.”
“Q2 has been as consistent as the previous quarter, with demand outstripping supply across the central belt. The narrative of the SNP/Green coalition must change in order to entice more landlords into the market as rents continue to rise. We are seeing fewer vacating notices than normal due to the increased costs of moving and rising rents. The rent cap and eviction moratorium has seen more landlords looking to exit the market, and a number of high profile corporate investors walking away from Scotland under the current government.”
“Q2 2023 has been extremely busy at The Flat Company. It is now established that Q2 has replaced Q3 as our busiest time of the year, with June being our busiest month. Our student properties are now let for 12 months a year and there are very few properties let over the summer. For tenants there is now a two-tier rental market following the introduction of rent control like Ireland. It’s an interesting and challenging time for both landlords and tenants and we will continue to adapt to changes in the market to ensure the best outcomes for both.”
“Government legislation exacerbates the pressure on an already limited supply of rental properties and puts disproportionate financial burden on landlords. We are therefore disappointed that the cost of living legislation will be extended again. Rents for most existing tenancies are now below market value, so tenants are remaining in properties for longer, resulting in limited turnover of existing stock. This, coupled with landlords being forced to sell and a lower number of new investors joining the market due to high mortgage rates, has led to very low levels of available stock. Demand for viewings remains higher than we have ever seen and we expect this to continue for the foreseeable future.”
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