TENANTS are taking advantage of a “glut” in properties for rent as the Capital’s housing market continues to suffer.
New figures show that one-bedroom flats are being valued at 15 per cent below average in some parts of the city, with owners opting to let rather than sell.
Estate agent DJ Alexander, which produces the quarterly Rental Tracker survey, said that an increasing number of properties being made available for rent meant landlords were being forced to work harder to attract tenants.
The average rent for a one-bedroom flat in the second quarter of 2012 was £583 – only marginally down on the £590 figure recorded for the same period last year. But certain areas saw steeper declines, with rents in areas such as Gorgie, Tollcross and Easter Road dipping below £500.
The figures also show rental values for bigger properties in neighbourhoods such as Marchmont and the West End are holding up.
Rob Trotter, senior property manager at DJ Alexander, said: “People who bought a traditional, one-bedroom flat in the £90,000 to £130,000 price range at or near the height of the property boom don’t have a lot of equity to play with.
“This has led to some unrealistic asking prices relative to the current market conditions but rather than drop their price they decide to let out instead.
“This additional supply has made lower rents more or less inevitable.”
The analysis was backed by other letting agents.
Ken Bell, director of OneLet, said: “What we are finding is that there’s still strong demand for very good quality properties that have been newly renovated. But tenants can pick and choose, and look for the best properties.”
Ross MacDonald, operations director at Click-Let, said: “We aren’t seeing lower rents among the properties we’re managing and we manage a wide spread of properties in the city.
“But there’s always going to be a tipping point. If there’s a high number of properties being transferred to the rental market that will lead to a glut of properties and there will be scope for savvy tenants to negotiate rents downwards.”
However, Chris Boisseau, director of Factotum Lettings, said his own firm had seen no evidence of a decline in rents and added: “I would say they have gone up recently and have now probably begun to level out but we do not have any evidence of rents going down.”
Making her move
CECILIA Macchione rents a one-bedroom flat in the Dean Village, close to the New Town office where she works as a translator.
The 33-year-old is considering a move and said DJ Alexander’s survey matches what she has seen.
“My friend lives in Easter Road,” she said. “You can see there are more apartments advertised for rent now. I’ve been looking at ads for one-bedroom flats in Gorgie and there are loads of places in the £450 range.”