Edinburgh needs far more investors to enter the rental market to meet growth targets in tenant numbers and rising affluence, a top industry insider has suggested.
Demand for residential lettings in Scotland’s capital city remains strong despite the effects of the Brexit vote and legislation on regulation and taxation recently enacted by the Holyrood and Westminster governments.
DJ Alexander Lettings, the rental agency focused on Edinburgh and Glasgow, said the quality of the uptake by applicants for new leases was high and stressed that more investors were essential to supply sufficient properties to meet demand.
Formal applications for tenancies received by the firm’s Edinburgh office are running at the rate of between 1,800 to 2,000 per month and statistics compiled by the company show that the applicants are, predominately, professional or skilled men and women employed in sectors with relative job security.
A significant number of these applicants are individuals relocating to the capital from overseas. The firm said its website receives some 25,000 visits per month and during July people located in 1,551 cities within 120 countries were among the visitors.
Rob Trotter, associate director, said: “Just like the opinion polls we assume a margin of error of 5 per cent in the questionnaire that all applicants for tenancies are required to complete. Even so the figures reveal a strong underlying current of demand for rented property in Edinburgh, the obvious conclusion being that the city still offers plenty of opportunities for investors in this market.”
The firm said some 35 per cent of enquirers have average earnings of between £25,000 and £49,999 a year while 6 per cent earn above £50,000. Although 94 per cent of applicants are aged between 20 and 40, 6 per cent describe themselves as managing directors and 23 per cent as senior managers.
About 34 per cent say they are employed in banking, insurance or other financial service while other prominent areas of employment are accommodation and food services; arts, entertainment and recreation; and health and education.
“This confirms that Edinburgh still has a thriving economy producing high-end jobs and attracting talented people who are paid high-end salaries,” Trotter said.
“The population is growing as a result. “However it is not just the number of future tenants that is significant; of equal importance is the fact that those seeking rental accommodation in Edinburgh will, in most cases, be in a position to adhere to their lease agreements and fulfil monthly rental commitments – in other words providing ‘good covenants’ for landlords.”