Average private sector rents in Scotland have increased by 4.9% over the twelve-month period leading up to February of this year, although there are some pockets of the country where rents have actually decreased. The overall rise leaves the average rent price being paid by Scottish tenants at £575 per month, according to the latest figures released by Your Move.
It’s worth noting that the overall rent rate has actually decreased by 0.1% month on month, with some places in Scotland seeing decreases as much as 3.3%. That particularly high latter percentage was for less populated areas such as the Highlands and the many islands around the Scottish coast.
East of Scotland’s Rents Remain Lowest Despite Big Rise
The rents being paid in Scotland’s eastern regions are the lowest in the country, with average rents currently sitting at £535 per month. Even though they are the lowest in Scotland, the rents in the east have still risen by 2.3% over the course of the twelve months leading up to February of 2017. However, even that rise is dwarfed by the 4.2% year on year increase seen in the southern regions of Scotland, where rents currently average about £560 per month.
Demand Drop-off and Government Programs Behind Rent Rise
The research by Your Move seems to indicate that the rent rise is being fuelled by a drop-off in demand, possibly caused by the government’s Low Cost Initiative for First Time Buyers (LCIFTB). The LCIFTB is a help to buy scheme which encourages lenders to offer zero percent deposit mortgages to enable more people to make the transition from being tenants to owning their own homes, especially young people.
Yet despite the apparent demand drop-off , the Scottish private rental sector is in good health and Your Move were quick to highlight the positive aspects of their research.
Your Move Scotland’s Lettings Director, Brian Moran, said, “The Scottish rental market continues to grow as a whole, despite variations on a regional basis. In February, we have continued to see demand reduce in several areas, particularly those with high numbers of migrants from European Union countries. Government schemes have also had an impact on the rental market with more people being able to purchase their first home and leave the rental arena.
“For landlords and investors, yields have remained strong, particularly when compared to the returns on property in England and Wales.”
