Prices for renting in Aberdeen have soared to record levels as a shortage of properties has fueled a frenzied demand by eager tenants, according to Citylets, the UK’s number one lettings portal.
Rental prices have broken the four figure barrier for the first time with average monthly rents reaching £1,002 – a 11.5% hike in a year.
High levels of demand have also seen properties in Aberdeen typically stay on the market for less than two weeks before being snapped up.
The Citylets Quarterly Report – covering July-September – also shows that across Scotland, the rental sector continues to remain strong with the average rents £687, up 1.5% on Q3 in 2012 while interest in rental accommodation – based on website views – shows no sign of abating.
Dan Cookson, Senior Analyst at Citylets, said while Aberdeen continues to be the most expensive place to rent in Scotland, the rise in prices between 2012-13 is startling.
He said: “Aberdeen continues to set itself apart from the Scottish rental sector with supply shortages fuelling price hikes.
“Numbers of rental properties advertised in Aberdeen city centre have fallen by nearly 50% this summer, while the continual growth of the oil and gas industry has seen the numbers of people locating to the city grow.
“The shortage in quality rental stock is reflected by the fact that a typical property is only the market for less than two weeks before being snapped up – with more than half of Aberdeen properties let within a week of being advertised.
“Large premium properties, favoured by executives and their families, have recorded the highest growth in rents.
“With limited new homes being built in the city, it seems fair to deduce that in future rent levels will continue their path upwards.”
Lisa Brebner, Managing Director, Simpson Brebner Lettings in Aberdeen said: “We are seeing an unprecedented level of rent being achieved with properties almost having to be advertised with “offers over”, similar to the selling market.
“There is a critical shortage of executive stock in both family sized houses and city centre apartments.
“It is clear the vibrancy of the oil and gas industry being reflected in the lettings market. If there is a negative impact if would be that the skills shortage in the industry is being compounded by a shortage of affordable housing in the private rental sector for people relocating to the area.”
The Citylets Quarterly Report, which confirms the July-September period as again the busiest period for the lettings market, coincides with the publication for the first time of the rental sector findings from the 2011 Census.
The Census findings show that between 2001-2011 the number of people in privately rented property doubled, with the sector accounting for 12.4% of all Scottish households. There are now more private rental tenants (619,000) than either council tenants (608,000) or housing association tenants (507,000). Edinburgh has the largest private rental market of any city in Scotland, sitting at 107,256 people.
Further illustration of the continued demand and interest in rental property can be found from the number of people viewing the Citylets website (www.citylets.co.uk) to look for accommodation. More than 1.1 million visitors viewed the site over July-September, up 22% year-on-year while August saw the highest ever monthly total of 405,000 site visits.
Elsewhere the report shows that Edinburgh has seen average rents rise to £820, an increase of 3.4%. Demand also remains very strong with two-thirds of Edinburgh properties let within a month of being advertised and a quarter of smaller one and two-bedroom properties actually let within a week.
In Glasgow, half of all properties are let within a month although average rents have levelled with prices up just 0.5% year-on-year to £618. The G4 post code experienced the biggest upturn with average rents increasing by 5.5%.
Dundee has also seen a drop in the time properties take to let – coming down nine days to an average of 40 days. Average rents were £555, up 1.8% on 2012. The DD4 post code saw the biggest jump in average rents – up 11% from £454 to £504.
Dan Cookson added: “The results from the Citylets Quarterly Report show that the private rental sector – despite the number of changes it has had to face over the past 18 months with issues such as the ban on agency fees and new requirements for tenancy deposits – continues to be highly sought after by both tenants and landlords.”
The Citylets rental report was launched in 2007 and has since become a respected guide for housing professionals including social housing and public policy makers.
– Citylets.co.uk was the No 1 residential lettings site in the UK according to Experian Hitwise
– A copy of the report is available online from Citylets research: www.citylets.co.uk/research/