Homebuyers’ plight pushes rental costs through roof

By Jane Bradley
Published on Thursday 13 October 2011 00:01

THE booming rental market has pushed prices in Edinburgh above £600 a month for a one-bedroom flat for the first time, as would-be homeowners remain in rented accommodation.

Estate agents have revealed that the cost of renting an average flat in the capital has risen by 7.5 per cent over the past three months, while rents in Glasgow have grown by around 6 per cent in the same period.

A lack of available mortgages, combined with fears that property prices could fall further, has meant that more people are choosing to rent rather than buy.

In Glasgow, a one-bedroom flat has reached £548 a month, while the average cost of renting a flat of any size has risen to £758.

Houses in Edinburgh now cost an average of £1,516 a month to rent, according to figures provided by estate agent DJ Alexander, while the average monthly rental for a flat is £874, and for a one-bedroom property is £602.

David Alexander, of DJ Alexander, which has offices in Edinburgh and Glasgow, said he believed the homebuying market would not recover until the economy improves.

“Until a couple of years ago, an individual or couple would rent a flat for six to 12 months and then buy a home of their own,” he said. “Now, if they move, it is likely to be to another rental property – for example, they need something bigger because a baby has come along or they simply fancy living in a different part of town.

“People are warming to the idea that rental properties don’t require a five-figure deposit or estate agency or conveyance fees. They know that if the roof leaks, the cost and responsibility is someone else’s, not theirs; and that they can move to another property by giving just one month’s notice.

“The trend towards unfurnished rentals – with tenants choosing their own beds, sofas, etc – is another sign that a rented flat or house is becoming increasingly looked upon as a ‘home’.”

In Edinburgh’s New Town, on Drummond Place, a one-bedroom flat had four would-be tenants all clamouring to take it. It eventually let at £1,050 a month.

“To break the £1,000 mark for a one-bedroom place is very unusual,” added Mr Alexander. “Some of these properties are taking no time at all to let.”

Across the city in Dalry, a basic one-bedroom flat took just hours to rent out, at a lease of £550 a month.

In Glasgow, on Park Circus, a three-bedroom flat was put on the market and rented in the same day for £1,475.

David Lamb, director of Aberdeen Property Leasing, said the city had experienced an increase in rental values of at least 10 per cent over the past six months.

“Since the start of the summer, we have let every property we have had on our books in a very short period of time. We currently have only 38 properties to let – about half what we would normally have and nothing for much under £500,” he said.

John Blackwood, spokesman for the Scottish Association of Landlords, warned that people on low incomes were being priced out of the rental market.

“People on lower incomes will find it harder to find accommodation in the private rental sector because of the demand. There is always someone there who is willing to pay the higher price,” he said.

Related Articles

• Jeff Salway: Recovery in west’s property prices proves short-lived

  A SUMMER house price recovery in the west of Scotland has come to an abrupt halt.

  0 Comments

Comments

There are 1 comments to this article

Order by:

• Newest first
• |
• Oldest first

Page 1 of 1

• 1
• Show all

1

Nome Deplumb

Thursday, October 13, 2011 at 12:11 PM

..wait a second here- the one bed in Gorgie is a lot less than £600 a month, and to buy is a bout 25% less than what it cost in 2007; shared between two- £300 a month plus bills-might be 400 each, so compare with student rental in Halls-... If your not building then what's available has to be in demand- its simply economics- when the Build of the century starts the new affordable homes revolution- then the supply will increase- Shelter should stop moaning and get building- loads of Brownfield land available- CHEAP-

• Report Unsuitable

Order by:

• Newest first
• |
• Oldest first

Page 1 of 1

• 1
• Show all

Logged in as:

Comment here. Start typing your comment here:

Post comment

Please adhere to our Community guidelines

Your view

Please sign in to be able to comment on this story.