Average rents in Scotland increased steadily last year, up 1.7% year on year in December to £571 and for landlords there were higher yields than most of the rest of the UK, the latest buy to let tracker shows.
The highest increase was a rise of 7.4% in the Highlands and Islands to £623 per month while Edinburgh and the Lothians has the highest rent at £665, according to the Your Move Scotland rental report.
The figures also show that month on month rents crept up 0.2% in December while on an annual basis rents have now increased in four of the five regions covered by the tracker.
Rents in the East of Scotland increased by 1.5% year on year to £539 while those in the South nudged up 0.7% to £553 per month. Only one region of Scotland saw rents fall in the last year with a decrease of 4.2% in Glasgow and Clyde to £548 per calendar month.
A typical rental property in Scotland delivered a yield of 4.8% in December 2017, continuing the recent steady performance Your Move Scotland found the average yield has remained at this level since September. However, it is down slightly compared to a year ago, when the average yield was recorded at 4.9%.
But these returns compare favourably to those found in England and Wales, where the average yield was 4.4%. On a regional basis, only the North East at 5% and the North West at 4.8% in England have outperformed the Scottish average.
According to Gordon Barron, area director for Your Move in the Highlands and Tayside, the main driver for the rent increase is high demand, particularly across Dingwall, Inverness and Elgin, with two bedroom flats being most sought after.
He also explained that there appears to be a higher number of high end properties coming to the market which is also pushing up the average rent figure. ‘The ongoing development of Inverness airport, the new south distributor route, has improved access around the region and the new University for the Highlands and Islands has undoubtedly increased demand for rentals properties in these areas, not only from students, but also from those looking to enjoy the attractive features of the Highlands while at the same time being able to commute to jobs elsewhere,’ he added.