Rents in Scotland up almost 2% year on year
Rents in the private rented sector in Scotland increased by 1.8% in the 12 months to March 2019 to an average of £580 per calendar month, according to the latest index figures.
Most areas of Scotland recorded a rise in rent but the pace of growth has slowed from the highs seen in 2018, the report from Your Move Scotland shows.
The biggest increases was in the Highlands and Islands region, up 4.9% to £688 but this was lower than the double digit increases seen last year. The only area to have higher rents was Edinburgh and the Lothians where they increased 4.6% to £699.
Elsewhere, there were also rises of 1.4% in the East of Scotland and of 0.9% in Glasgow and the Clyde region. The average rent in the East is now £541 per calendar month while in Glasgow and the surrounding areas it is £589.
The South of Scotland was the only region to see rents fall on an annual basis, dropping 1.9% to £537. It remains the cheapest place to rent in the country.
On a monthly basis, two regions posted rises in rents, a further two saw prices fall while rents in Edinburgh and the Lothians were flat compared to February. The South of Scotland saw rents rise by 0.6% month on month while the East of Scotland saw an increase of 0.5%.
The largest monthly fall was a decrease of 2.5% decrease in Glasgow and the Clyde while the Highlands and Islands saw a 0.5% fall.
Landlords in Scotland saw an average return of 4.7% in the year to March 2019, a six month high and the first monthly increase in yields since March 2017, and Your Move says this suggests that the recent squeeze on returns may have come to an end.
This is in contrast to England and Wales, where yields have held steady. Across both nations the average return this month was 4.3%. The only two regions to offer returns higher than the Scottish average during March were the North East of England at 5% and the North West at 4.8%.
‘Investors in Scotland have seen stronger returns this month than in February. This is the first rise in monthly yields since March 2017 and demonstrates why many investors from elsewhere are now looking towards Scotland to maximise returns,’ said Brian Moran, lettings director of Your Move Scotland.
‘Additionally, with more tenants now renting for longer thanks to the introduction of the PRT, landlords are benefitting from the increased security and stability provided by these tenancies,’ he added.