With perhaps ironic timing, rents across some parts of Scotland are falling - just as the Scottish Government prepares to outline rent controls in the Private Tenancies Bill being published imminently.
The latest quarterly report from Citylets shows that Scotland-wide rents have fallen from their 2015 peak of £762 per month in the summer to £757 now, while annual growth has slowed from 5.4 per cent last quarter to 2.9 per cent today.
Aberdeen, which first recorded price falls last quarter - down 3.8 per cent - has tumbled further with an annual rental drop of 6.7 per cent. Conversely Edinburgh continues its upward trajectory for the 10th successive quarter recording annual growth of 7.5 per cent.
Aberdeen’s downward trend continues for the third successive quarter and is likely to continue throughout 2016 says Citylets. Average rents are now below £1,000 for the first time since the second quarter of 2013 at £995 with average time to let at 34 days, more than double this time last year.
The changing fortunes in Aberdeen may pose questions for the Scottish Government plans for rent controls, according to Citylets founder Thomas Ashdown.
"By the start of 2016, it will be a fact that no rental property type in Aberdeen will have outperformed inflation since the onset of the credit crunch. Rents may even fall to the same levels as 2008/9 which would be a significant drop in real terms" he says.
"It would seem that Aberdeen now represents a clear example of how the Scottish private rental sector can self regulate. With so much concern in the investor community in relation to rent controls, the Scottish Government must surely want to consider whether the intended benefits outweigh the risks at this time" he says.
The average property in Edinburgh now rents for £942 per month and takes just 20 days to let. Popular one and two bed properties have shown the steepest growth at 7.3 and 8.5 per cent respectively and taking just 16 and 19 days to rent.
Glasgow meanwhile is continuing to edge up modestly at 2.2 per cent to £684 per month and taking just 24 days to rent. The annual rate of growth has slowed down from 4.4 per cent last quarter.
Article courtesy of Letting Agent Today | Sign up for Letting Agent Today newsletter | Get this news on YOUR site!