Aberdeen has biggest rise of lodgers in UK

Catriona Mackenzie rents out a room in her Aberdeen city centre flat. Picture: Hemedia

The number of “lodger wanted” ads has rocketed by 140 per cent in the Granite City over the past two years as people look for alternative ways of making extra cash from their spare room.

The average price commanded for renting a room in someone else’s house in Aberdeen is £549 a month – £57 higher than the national average of £492 and more expensive than anywhere outside of the two priciest areas of London and Twickenham.

There are also three would-be lodgers looking for every available room in Aberdeen.

No other Scottish cities feature on the list of top 30 places in the UK with the highest growth in homeowners becoming live-in landlords, compiled by Spareroom.co.uk.

UK-wide, “lodger wanted” ads are up 41 per cent over the two year period.

Blackpool and Liverpool are the two cities ranked after Aberdeen in terms of increased demand for lodgers with a 38 per cent and 36 per cent increase respectively. In London, ten people are chasing each available room, the report found.

People questioned by Spareroom.co.uk also revealed that almost half of “live in landlords” could not afford to pay their mortgage without a lodger.

Matt Hutchinson, director of Spareroom.co.uk, said: “We’re in the middle of a massive housing crisis in the UK.

“House prices and rents are becoming unaffordable and, in the rental market, there’s a chronic shortage of decent, affordable stock.

“We need to build 250,000 new homes every year – that’s simply not going to happen any time soon. We haven’t built in those numbers since the 1970s, so we must do far more to use existing stock better.”

He added: “The lodger trend is already going a long way to helping, providing hundreds of thousands of affordable rooms across the UK, but we need to do more.”

Aberdeen has topped lists of rapidly rising property prices in recent years as demand for accommodation for people working in the oil industry has pushed demand higher.

Average rents are higher than in most other areas of Scotland, pricing many people out of buying their own property or renting alone.

The recent dip in oil prices, however, has caused many people to cut back on costs, which may have pushed more people towards lodging.

Under the Government’s Rent A Room scheme, homeowners and renters letting rooms to lodgers can earn up to £4,250 per year tax free, and must declare additional earnings to the Inland Revenue, meaning they need to fill out a tax return annually. However, only a fifth of UK towns now have average rents within the tax threshold, suggesting the threshold, which has not changed since 1997, is now out of date.

In Aberdeen, the average annual rental income is well above the tax threshold, at £6,588.

Mr Hutchinson added: “The current £4,250 threshold discourages people from letting rooms because they’re nervous about having to fill out tax returns. Increasing the Government’s Rent A Room Scheme limit to reflect the market today, rather than 18 years ago, will act as an incentive to many cash-strapped homeowners.”

CASE STUDY

Catriona Mackenzie, 25, a senior account executive with PR firm the Big Partnership in Aberdeen, rents out a room in the two-bedroom flat she bought in the city centre last summer.

“I was fortunate in that I was able to purchase my own flat last year and I wanted to get someone in to help cover costs. I’m a young professional woman and luckily there were a lot of people like me who were looking for someone to live. I interviewed about six and e-mailed a few more.

“The social side is great. I don’t understand the obsession about people wanting to live on their own and be so independent. It is nice to have someone else there in the evenings. Having an owner landlord means the flat is nice for the lodger – I’m going to want to live somewhere nice so I’m not going to let it get run down.

“I’m not surprised that there has been an increase in the number of people lodging or looking for a lodger. Aberdeen is an expensive city and with what is happening in oil at the moment, a lot of people are trying to keep living costs down in case their job situation changes.”