Double digit annual rent inflation for five quarters in a row

Average rents in Scotland for new tenancies in the private rented sector have risen by double digits for the fifth quarter in a row - meaning ever since the introduction of rent controls north of the border. 

The new figures from lettings portal Citylets underline what many in the industry feared; that the legislation introduced by the SNP and Green ruling alliance, to cap part of the market, would impact adversely on new rental prices.

The picture within Scotland’s main cities was mixed with the rate of growth in the central belt easing, which will be welcome news to tenants, whilst Aberdeen posted the strongest annual growth at almost 10 per cent which will be welcomed by landlords where rental values only now return towards pre-financial crash levels.

The overall picture for Scotland, however, still saw double digit year on year growth for the country as a whole at 12.9 per cent, sending average rents to £1,097 per month. Edinburgh and Glasgow recorded single digit rises for the first time in two years at 9.7 and 6.1 per cent respectfully.

Citylets managing director Thomas Ashdown comments: “Rents in the open market of the Scottish Private Rented Sector have continued to rise steeply right through to the end of 2023 capping a unique year of sustained, unprecedented rental price inflation. That this occurred during a period of emergency legislation is far from co-incidental, however well intended.

“As we enter 2024, the central belt has seen its rate of growth ease which will be welcome news to tenants however all resident in or providing accommodation to the sector await with baited breath what 2024 will bring; a year in which it will be a case of out with the old and in with the new as regards further temporary legislation.”

Citylets says 2024 is destined to be another year of change for the Scottish private rental sector with the ending of the emergency Cost of Living (Tenant Protection) (Scotland) legislation which put a cap on rent rises within existing tenancies. However rents will likely remain controlled though new legislation designed to mitigate sharp increases by landlords where rents may be considerably below open market rent values.

Additionally, proposals for full market rent controls will become clearer in 2024, the impact of which on available supply will be keenly awaited by all stakeholders.