Strong start to 2017 for Scottish rental scene as Edinburgh and Lothians region continues to dominate says Your Move Scotland Buy to Let index
The Edinburgh and Lothians region dominated the Scottish rental scene once again in January with prices in the capital and surrounding areas growing faster than any other part of the country in the last year, according to the latest Buy to Let index from Your Move Scotland.
The average property in Scotland now lets for £571 per month, compared to £548 a year ago and £573 in December 2016, but prices in Edinburgh and Lothians remained above average, standing at £648 in January 2017.
Prices in the region have increased by 3.3% in the last 12 months to reach £648 in January 2017. However they were absolutely flat month-on-month.
The next highest rents were to be found in the Highlands and Islands region, where rents in stood at £584 in January. Rents in the region grew 0.6% between December and January, however, they are 4.3% lower than a year ago – the biggest faller during that period.
The only other region to post a year-on-year fall was Glasgow and Clyde where prices have ticked down 0.9% since January 2016 and now rent for an average of £566.
The cheapest place to rent continued to be the East of Scotland, where properties now let for £533 per month, 1.3% higher than a year ago and up 0.4% month-on-month.
In the South of Scotland, rents grew by 2.7% in the year to January. Properties in this region are now on the market for an average of £555 a month.
Despite 2016 containing changes to the tax system for buy-to-let landlords, the UK’s vote to leave the European Union and general economic uncertainty yield levels remained steady over the year, with an average yield of 4.9% in January 2017.
This is exactly the same as in both January 2016 and the previous month and compares strongly to property investment in other parts of the UK. Only landlords in the North East and North West regions of England enjoyed better returns – 5.3% and 5% respectively – in January.
Tenant arrears increased slightly following the Christmas period and across all of Scotland 11.75% of tenancies had arrears of one day or more during January 2017 – higher than the 10.8% rate recorded in November 2016.
On an absolute basis, the number of Scottish households in serious arrears – defined as two months or more – was 10,413 in January 2017.
“It was a strong start to the new year for many landlords across Scotland as rents continued to perform well,” said Brian Moran, lettings director, Your Move Scotland.
“Edinburgh and Lothians is the best performing region with prices growing faster than anywhere else in Scotland.
“Despite new government rules which cut tax relief on buy-to-let properties making business more complicated for landlords, yield levels have remained strong in the past 12 months.
“Yields are exactly the same as a year ago and suggests the Scottish rental market continues to attract quality investment into its housing stock.”