Scottish letting agents give us their views on their local market.
“The first quarter has shown the level of stock at record low which is causing an increase in the rental figures. With the downturn in the sales market there are good opportunities for landlords to secure a property at a lower rate while achieving a high yield. We are still seeing a strong demand from tenants, therefore, it is a good time for any landlords thinking of entering the market.”
“There are some signs that the market may have become more price sensitive and reached peak rental inflation as tenant affordability issues constrain upward pressure even while stock levels remain at historic lows. That said with the end of the COLA legislation many landlords are likely to seek increases to close the gap between existing tenancy rents and those of new tenancies as they seek to mitigate their risk due to further rent controls proposed as part of the new housing act. Stock levels could also increase as evictions that were held up under the moratorium are now implemented. It will be interesting to see how all this affects the market and inflationary pressure over the coming months.”
“The unfortunate consequences of good intentions are coming home to roost. The Scottish Government have failed and continue to fail to listen to industry experts and advisory bodies which is greatly impacting the rental market as a whole in Scotland. This is to the detriment of the tenants they say they are seeking to protect. As ever, demand outstrips supply and it is only going to go one way unless coherent policies are implemented and soon.”
“First quarter of 2024 has been full of activity. Rents at the point of re-letting a property have consistently increased. This trend will extend to current tenancies after 1st April 2024, when the rent increase cap legislation will cease. This is extremely good news for landlords in Aberdeen who saw rents collapsing after 2015. In turn, landlords in Aberdeen are coming back to the market. There is a particular increase of supply of detached and semi-detached properties, which we expect will help to satisfy the high demand in this sector of the market. This market is not limited to the city centre, though, as savvy tenants are heading to the outskirts in search of relatively lower rents.”
“We’ve seen a quick exit from the usual seasonal slowing in Q1. Interest remains significant - keeping rents high and TTL low. A welcome end to the moratorium on evictions and ‘rent cap’ is good news for clients, but a feeling remains that had it been left alone, perhaps rents wouldn’t be as high as they are currently for tenants and an equilibrium would have been found. Looking ahead to spring and summer, we expect normal movement of tenants and continuation of the same trends in the market. Investment is picking up pace and we’re working hard to meet demand!”
“Confidence is beginning to make its way back into the rental market, brought about by lowering interest rates and certainty over the Scottish Governments regulations after the ending of the rent cap. 1Let is witnessing the return of investors to the market with many new properties being purchased. Tenant enquiries remain high with strong demand for almost all rental properties. Realistic rental valuations remain a priority with affordability becoming more of an issue for tenants.”
“The Rental Market in Edinburgh remains strong with good stock levels available, however demand is not as frantic as it was. With more measured legislation in place regarding rent increases, landlords, letting agents and tenants alike are looking forward to a more settled period of rental figures as opposed to spike in rents seen in new properties coming onto the market and unnecessary restriction of rent increases for existing tenancies. As the whole industry breathes a sigh of relief as we all hope the Scottish Government does not try to manipulate the rental market again with further legislation, as its previous attempts only succeeded in having the opposite effect to those intended.”
“With ADS increased to 6% in 2023, council tax discounts being scrapped in some local authorities and the Scottish Government’s heavy involvement in the private housing market, the rental market has become less appealing to current and would be landlords as an area of investment. This reduces the available housing for renters, increases rent values and adds to Scotland’s housing crisis. We therefore expect to see demand far outstripping supply for 2024-2025 unless new policies are introduced by the Scottish Government to re-incentivise landlords to re-enter the market.”
“In Q1 we experienced a significant increase in turnover of tenancies for existing stock, higher than any quarter in 2023. At the lower end of the market, demand still exceeded supply but there was a noticeable reduction in demand for higher value properties. We saw a similar trend to Q1 2023 with numerous landlords choosing to exit the PRS and sell their properties due to financial pressures. We are pleased that the government is relaxing rent restrictions from April, providing much needed relief to some of our landlords. The new tapering system is undoubtedly more complex and there are some outstanding questions on how it will work in practice.”
“As we approach spring, the market is slowly beginning to pick up after a sluggish winter period. Tenant demand is returning. Requests from students for HMO’s is in full swing. Will this year see the same pattern as previous years with tenants staying on and not giving notice due to the shortage of HMO accommodation? It will also interesting to see how the market reacts to the end of the 3% rent cap and eviction moratorium. What affect this will have on rents is yet to be seen. We are seeing some landlords exit the market but also seeing more of the circumstantial landlords enter.”
“After a slow start things have picked up with high levels of enquiries for all properties. This is despite average rents in the capital having reached an all-time high and clearly the result of fewer properties becoming available. It may be a bit early to predict if investors will return quickly once the rent cap is lifted but it would seem likely and will ease the situation over time. One and two bed flats are highly sought after but larger three bed non HMO properties are taking a while to let, and rental values at that end of the spectrum are not moving much at all.”
“Demand for properties in Edinburgh remains high. During the first quarter of 2024, we have seen a steady increase of 2 bedroom properties coming to the market, but a shortage of one bedroom properties has carried over from 2023. This appears to have levelled the market rent for 2 bedroom properties, whilst the market rent for 1 beds continues to be at an all-time high. We have witnessed landlords leaving the PRS, but our agency has also attracted new clients leaving the short-term lettings market helping to rebuild the supply of properties available to tenants seeking long-term homes.”
“2024 presented an interesting start to the year, with an expected burst of activity in the first couple of weeks of January, then a general slowdown, consistent with the latter part of 2023. Rents, whilst remaining high in general, have not had automatic growth during the marketing process; in fact, we saw rent levels remain the same or having a slight decrease for the higher rent properties. The challenges remain for tenants with continued higher cost of living and a more considered approach towards money. However, the market is like a simmering pot and ready to burst again as we enter spring and head to summer when a flurry of new activity will see greater demand, fewer properties available and rents picking up.”
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