Scottish letting agents give us their views on their local market.
“Landlord and tenant activity accelerated throughout August and September. Our portfolio average rent increased by 5.7% in Q3, thanks to more high-end tenancies secured, as well as the natural increase of rents of our historic portfolio. Consistent, well-presented and well-maintained (long-term) properties are key to seamlessly long-term tenancies. The well-presented element must include the marketing expected in the 21st century. The well-maintained element must address and exceed the expectations laid down in the new Repairing Standards to be introduced in March 2024. The market belongs to those who adapt the most.”
“Q3 has been exceptionally busy with changeover of tenancies and reletting. TTLs are really low and, as seems to be the norm now, rents are very high! There isn’t enough stock to meet the demand. I don’t think this trend will change in the coming months and expect our clients will continue to have nearly 100% occupancy. With Q4 approaching and the onset of winter we hope to continue our portfolio growth and look forward to welcoming clients from the short-term sector to help them with their long-term rentals moving forward with the imminent changes to licensing.”
“The third quarter of the year has traditionally been one of the busiest seasons in the PRS calendar, as students desperately try to source suitable accommodation. This surge in tenant interest complied with a distinct lack of stock, is pushing rents beyond what is reasonable unless you are across here studying under a foreign government sponsored scheme. We have seen prospective tenants having to be much more flexible and realistic in seeking properties and having to travel further to get cheaper accommodation. As we enter into the winter months many are more focussed on trying to find more energy efficient properties.”
“Q3 has been a very busy time for the rental market in Aberdeen. Month on month we see enquiries peaking a new record level. Properties across all sizes have seen an increase in price on the open market due to high demand and lack of supply. Times to let have improved again this quarter, with some properties letting within hours and family homes seeing several applications. The economic environment across several sectors in Aberdeen is buoyant, creating positive news for many in the city and Shire. We have also seen several investors coming to the market looking for help to set up tenancies and then self-manage.”
“The third quarter is traditionally the busiest for the PRS as the student market reaches its peak. This year felt especially busy due to demand across all areas of the market being so high. Anecdotes of people staying with friends and in AirBnB’s etc because they cannot find a home continue. Reports of scammers seeking to take advantage of peoples’ desperation to find a home by falsely advertising properties and fraudulently obtaining payments, have increased by 23% to almost 6000 throughout the UK. These types of scams are only likely to increase whilst supply remains so low and people remain so desperate to find a home.”
“As existing tenancies come to an end and we have put properties back on the market in quarter 3, we have been able to achieve substantial rent increases for our landlords. Given landlords with interest only mortgages have seen their mortgage cost treble, this helps alleviate some of the pain of the recent interest rate rises. The question now, is what is going to happen to rent control on the 1st April 2024 and an end to this uncertainty would be appreciated to keep existing good landlords in the market.”
“The Edinburgh market continues to be dominated by a significant supply/demand imbalance which results in feverish levels of competition among tenants with multiple applications for any property advertised. We are seeing increasing levels of desperation from people looking to secure a home in the city. All this adds upward pressure on rents for new tenancies which is further exacerbated by landlords looking to mitigate against rising costs and the risks associated with the Cost of Living Act. Recent announcements made in Holyrood will do little to settle landlords concerns and we expect market conditions to remain much the same over the coming months.”
“Our own data echoes Citylets figures. YOY rent increases for 1 and 2 bed flats are 11% and 15% respectively. Less so on HMO’s, but still 5%+. Tenant demand is very strong, with properties on the market for hours, not days. Stock availability is almost zero. As I write, we have only 0.25% of our managed portfolio available to let! Investor activity is still fragile – a wait and see approach, with further housing regulation to come. Rents are expected to continue increasing as demand grows and supply remains low. Student demand is still taking up 1 and 2 beds as the city now has fewer HMO’s with a knock-on effect in the professional market.”
“The market continues to be blighted by a chronic supply shortage, resulting in spiraling rent levels and frenzied tenants seeking to secure properties. Even more worryingly, we have seen a dramatic reduction in the number of new landlord enquiries, which is down by two thirds on recent months. While some of it may be attributable to seasonal variation, it is likely that the recent rise in interest rates, in combination with years of landlord bashing from Holyrood and Westminster, has made becoming a landlord less viable. Meanwhile, recent announcements about stricter rent controls have rattled more seasoned landlords.”
““Demand far outstrips supply and we can only see this worsening in the short term as a knock-on effect of the government legislation, with the best intentions to protect tenants, having the complete opposite effect. The government needs to seriously listen to various bodies such as The Scottish Association of Landlords, ARLA, the RICS and industry experts in order to even remotely right, what is a sinking ship. The answer is to encourage investment, build more houses and increase supply, only then will rental levels across the country balance out. Rent control is not the answer.”
“Demand for rented accommodation in Edinburgh is still extremely high. A single advert can attract as many as 150 emails which makes it impossible to reply to all those who show interest, which must be very frustrating for tenants looking for a new home and is putting pressure on agency staff. Government legislation is still a major concern for landlords. As more properties are refused as holiday lets, will they join the longer-term market? This is far from certain given current mortgage payments and further indications that there will be additional costs to comply with the new repairing standard.”
“We continue to witness a robust demand for rental properties in Edinburgh, with tenants applying in abundance. Further, a significant number of serviced accommodation landlords are showing concern about their property investments and are choosing to transition to the long-term lettings market through our services. This shift is driven by the current bullish nature of the long-term lettings market. We anticipate this trend to persist, as we believe the long-term market is thriving.”
“I recently had the privilege of conducting my first property viewings of the year, and it left quite an impression on me. I met five wonderful individuals at a one-bedroom flat in Leith. This encounter, however, painted a poignant picture of the challenging housing situation many currently face. Despite each of them holding stable jobs, I found myself in the tough position of not being able to help every one of them. With over 300 other interested parties waiting to view the same flat, it’s clear the demand in Edinburgh is overwhelming with no end in sight to the relentless widening of the gap between demand and supply.”
“There has been a lot of movement in Q3. The summer frenzy for properties has peaked in recent weeks and rent amounts are showing signs of easing. For some, fixed rate mortgage terms have come to an end and mortgage payments have significantly increased. Usually, we agents would guide landlords on rental values, however, recently landlords are now stipulating the minimum rental figures that they need to achieve to keep their buy-to-let sustainable. Q3 hasn’t been all doom and gloom though, as we have taken on many new instructions from new landlords in the last quarter. It seems to be the younger generation investors for which, all the new PRS regulations are the ‘norm’.”
“Q3 in Aberdeen has shown a real surge in rental prices which have risen to meet demand across most property sizes. 1 and 2 bedroom properties have shown the biggest demand with stock levels dropping dramatically. An interesting trend was seen within the student market where large HMO properties have been left on the market without tenants; this ties back to Covid and 3rd and 4th year students generally having smaller friendship groups, and choosing to live in 1 and 2 beds however, we expect this trend to recover over the next 2 years. Quality supply is going to be the challenge over the next quarter.”
“In yet another period of unprecedented demand, the supply on the lettings market remains stretched with increased numbers of tenants scrambling for available properties. The late summer phase is our busiest time, with the intake of students, families and young professionals desperate to secure and settle into a new home. As landlords and letting agents, we need to ensure the quality of properties and service remains, as rent levels and demand will likely remain high along with expectations.”“In yet another period of unprecedented demand, the supply on the lettings market remains stretched with increased numbers of tenants scrambling for available properties. The late summer phase is our busiest time, with the intake of students, families and young professionals desperate to secure and settle into a new home. As landlords and letting agents, we need to ensure the quality of properties and service remains, as rent levels and demand will likely remain high along with expectations.”
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