Property Values & Rents Increase in Scotland

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A 3.3% rise in rents in Q2 2010 gives optimism to the estimated 100,000 private landlords in Scotland.  Following similar suit to England & Wales, tenant demand is increasing.

Edinburgh recorded the highest rise with an increase of 4.3% up on 2009 with Glasgow showing a rise of 2.6%.  It appears the similar trend to England & Wales is a result of un-available social housing and difficulty in obtaining consumer mortgages.

The Register of Scotland (ROS) reported an increase of 5.3% during the first half of the year of house prices compared to last years values.  Again Edinburgh took the lead with a 17.3% rise in the number of house sales and an impressive 7.8% house prise increase with Glasgow reporting a modest but acceptable 11.2% in sales.

In stark contrast to the increase in house prices and sales, the latest data for Q2 2010 suggests an increase in the number of construction companies entering liquidation in Scotland, compared to England & Wales, where data suggests a decline in liquidations indicating a possibility that Scotland may have entered the recession later than England & Wales.

While the rise in house values and rents is welcome news for landlords, the social sector is faring less better and suffering the same fate as the rest of the UK.  Scottish response has resulted in a new tenant incentive scheme, which is being piloted in Edinburgh.  In a bid to relieve over-crowded council accommodation, the council are offering a maximum of £1000 to cover the costs of moving and will be offered to tenants who are living in houses larger than their needs require in hope that they move to more suitable accommodation.  Edinburgh council estimate that over 1000 homes are under-occupied.  If the pilot scheme is successful, other councils across Scotland may adopt the initiative in answer to the housing shortage.

By
Madalena Penny