AVERAGE rents in Aberdeen, Europe’s oil capital, have soared past the £1,000 a month mark for the first time, it was revealed today.
Private property rents in the city are now averaging £1,002 a month, according to a report published by letting website Citylets - an increase of 11.5 per cent on last year’s rental average.
Rents for one bedroomed properties have risen by nine per cent to £629, two bedroomed properties by 10.9 per cent to £924, and four bedroomed properties by 14.9 per cent to £2,011.
Aberdeen is now the most expensive place to rent a home in Scotland, with the average lease in Edinburgh at £820 a month, and Glasgow £618.
In the third quarter of 2013, the average monthly rent in Scotland stood at £687 which is 1.5 per cent up on the figure of a year ago.
The report states: “Aberdeen has experienced the fastest rates of rental inflation of any city in Scotland over recent years. Average mix adjusted rents rose to four figures (£1,002) for the first time in Q3 2013, a rise of 11.5 per cent over the year. “
Over the past twelve months to time taken to let a private property in the city has also improved from 19 days to “an extremely short” 13 day average.
The report states: “More than half (52 per cent) of Aberdeen properties were let within a week of being advertised and it now seems a shortage of supply could exacerbate the situation going forward. Aberdeen is unusual in having a larger proportion of family sized houses in the PRS (Private property rents sector) than other cities, a function of being host to a global oil industry, and it is those areas of larger premium properties that have seen the most growth in rents.”
The report continues: “Continual investment and consequential job creation driven by the burgeoning oil sector has increased the pressure on physical stock even more. The number of rental properties advertised in
Aberdeen City centre has fallen by nearly 50 per cent this summer from 328 in June 2012 to 222 this July. Prospects of high rental yields have seen investors help push up the average selling price of flats in AB10 with an increase of six per cent from Q2 2012 to Q2 2013 (£170,927 to £181,215) while the national trend shows a very slight decrease in flat prices from £117,560 to £117,517 over the same period.
“This phenomenon is not restricted to the residential rental market. Oil and gas companies are occupying eight per cent more office space in the first half of 2013 inflating prime commercial rents in the Granite City.”
It adds: “With limited new homes being built in the city (425 in 2012), it seems fair to deduce that in future rent levels will continue their path upwards. There is also little doubt that the 2,318 people identified in the 2011 census as living rent free in Aberdeen can count themselves very fortunate indeed.”