After 2 consecutive quarters without meaningful positive growth at National level, the Scottish PRS returned to the black. Significant further easing of the rate of decline in Aberdeen coupled with business as usual in the central belt saw the overall National average grow by 1.5% year on year (YOY) to stand at £789 per month. With a reported decline in new BTL instructions, Build To Rent at scale seems ever more requisite for Scotland’s younger urban residents in major cities and the recent ‘reset’ on Indyref2 is likely to represent a welcome fillip for the Institutional investor market.
Markets in Dundee, West Lothian, South Lanarkshire and Renfrewshire recorded steady figures with rents rising around 1%. The outlook for Scotland’s PRS seems to be one of continued growth in major conurbations underpinned by the central belt and, should Aberdeen’s market fully level off or indeed rebound, we could see YOY rises back to 3-4% mark at the National level in the near future.
“Build to Rent is now emerging in Scotland as a key new residential use class, with over 2,500 units now in the pipeline in Edinburgh and Glasgow. This is driven by a rising rental market and socioeconomic changes, in the overall context of weak housing supply, creating opportunities for developers and investors. Scottish cities compare favourably to other parts of the UK in terms of yields, entry prices and potential for growth. At nearly 7%, average gross rental yields in Glasgow are as high as they are anywhere else in the UK. Affordable BTR schemes are now well established in Scotland, with high levels of demand in appropriate locations, including Western Harbour in Edinburgh, where there were over 3,400 applicants for a 96-unit Mid-Rent development.”
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