Rents rocket by 10% but landlords claim they ‘are not being greedy’

Renters in Edinburgh are being priced out of the market. Photo: PA
Renters in Edinburgh are being priced out of the market. Photo: PA
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RENTERS in Edinburgh and Aberdeen are being priced out of the market because of soaring demand, with prices rising by 10 per cent to an average of £862 a month over the past three years.

The average rental price in Glasgow, however, has fallen by just over 5 per cent over the same period, according to the rental tracker compiled by Central Belt estate agent DJ Alexander.

Meanwhile, the 20th annual report from Citylets heralded a “buoyant” rental sector across Scotland in the final three months of last year – with Aberdeen ranking the most expensive for rents, Scotland-wide, closely followed by Edinburgh.

Experts warned that the soaring cost was making it difficult for young people – already unable to get a first step on the property buying ladder – to afford a home.

“News that rental prices are rising in the private sector is a major concern and shows that the housing crisis touches everyone,” said Graeme Brown, director of Shelter Scotland.

“A lack of social housing, high house prices and lack of affordable finance means that increasing numbers of people have no option but to look to the private rented sector.

“But where renting was once the easy, cheap alternative to home ownership, rising rents have forced many ordinary families to cut their spending on essentials like food and heating, or uproot and move away from jobs, schools and families in search of cheaper rents.”

The average rent for a two-bedroom flat across the country rose 1.5 per cent from £617 to £626 between the final quarter of 2010 and the same period in 2011, according to the Citylets report. For one-bedroom flats, the typical rental value achieved rose 3.6 per cent year on year, from £473 to £490.

“Generally, landlords are enjoying steady increase in rents, while properties are generally empty for less time,” said Dan Cookson, senior analyst with Citylets. “The good news for tenants is that many rent rises are well below inflation. Landlords are not being greedy. It’s a competitive market and most of them are in it for the long term and realise that short-term rent hikes are likely to lead to longer void periods.”

Lack of mortgage availability is forcing more people to continue renting, pushing demand for properties much higher.

The average time it took for a property to secure a new tenant rose slightly from 35 days in the final quarter of 2010, to the end of last year, the report said, when landlords typically had to wait 39 days for the flat to be filled.

But in areas such as Edinburgh and Aberdeen, where demand for good-quality rented properties is outstripping supply, the average time for a property to be let is much shorter than the rest of the country. Overall, one-bedroom properties are far quicker to let than four bedroom homes – by 24 days.

The DJ Alexander rental tracker found that while prices were not as buoyant in Glasgow as a whole, one- and two- bedroom flats in areas of high demand, such as the Merchant City, Hillhead and Shawlands, were holding up well.

David Alexander, owner of DJ Alexander, said the figures could be skewed by a large amount of property coming on to the rental market in Glasgow that is not traditionally typical rental stock – due to owners being unable to sell in the depressed property market.

John Blackwood, director of the Scottish Association of Landlords, said: “This is indicative of the fact that there are more people looking to rent at the moment as they’re finding they can not get on the house buying ladder.”