Rent prices are rising faster in Scotland than anywhere else in the UK, according to new figures.
Average monthly rents north of the Border have risen by more than a tenth, 11.7 per cent, in the past year from £571 to £638, mainly due to a large 8.7 per cent jump between October and November, according to letting support agency HomeLet.
This rise outstrips even Greater London, where prices increased by 11 per cent, from £1,268 to £1,408. Scotland is now the sixth most expensive place to rent a home out of 12 UK regions surveyed, up from tenth place in 2013.
HomeLet said the rise was down to Aberdeen’s thriving oil-driven rental sector and Scotland’s comparatively strong employment and economic figures.
However, rents remain below the UK average of £874, or £702 once the booming Greater London market is excluded.
Scottish growth contrasts with an annual drop in rents of 2.5 per cent and 3.6 per cent in the neighbouring north-east and north-west of England respectively.
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Martin Totty, chief executive of HomeLet parent company Barbon Insurance, said: “We see the autumn’s moderation in rental growth [in the UK as a whole] as broadly in line with the typical seasonal effect that often sees rental prices balance, or even slip into reverse, in many areas of the country at this time of year.
“But in terms of seasonal highs, we see Scotland bucking the trend of the rest of the country. The rapid growth in the Scottish rentals market reflects the strength of the economy north of the Border – particularly in oil-rich Aberdeen, which has a thriving rentals sector, but also in other Scottish cities and throughout the country.
“A report published this week shows Scotland now has the highest employment and economic activity rates, and the lowest unemployment rate, of any of the four nations of the UK.”
Mr Totty added that the outlook for the private rented sector remained “positive for several reasons”.
He said: “The pace of housebuilding is unlikely to have a significant effect on the supply of property to buy or to rent in the short-term, and high house prices and a mortgage market where lending criteria remains constrained are combining to ensure that the demand from tenants needing rented accommodation remains strong.”
Graeme Brown, director of Shelter Scotland, said: “This comes as no surprise to us and people living in the private rented sector, particularly those renting in Edinburgh and Aberdeen where high rents have a knock-on effect for the entire community.
“We want to see a sector that thrives and is fair for both tenants and landlords, where rents are stable, rent rises are predictable and where families can put down roots in their community.
“That’s why we launched our ‘make renting right’ campaign to raise awareness and make the private rented sector fairer for the 300,000 households now reliant on the sector in Scotland.”
Last month, a HomeLet survey showed that the Edinburgh rental market was the least affordable in Scotland, and second only to London.
An analysis of rents across the country compared with local incomes showed that, in Edinburgh, rent costs 47 per cent of net income, on a par with Birmingham, and close to London levels.
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