London property tycoons set sights on Edinburgh
PROPERTY tycoons are turning their eyes from London and towards the Capital as estate agents report a surge of interest in city homes.
Lettings expert Cullen Property reported a 30 per cent rise in investors interested in snapping up properties across Edinburgh.
They said wealthy landlords were ditching London amid concerns its market had peaked.
But campaigners said the boom in investors risked driving up prices, making housing less affordable to residents and incomers.
Referring to a recent property show, Steve Coyle, operations director at Cullen Property, said: “Investors stated they were preferring to move away from London investment feeling that the property market there had peaked and were keen on exploring other UK investment hotspots.
“They were interested particularly in Edinburgh as, unlike other major UK cities, it has the diversity of being a major student centre, as well as being the second tourist city destination in the UK. They were particularly interested in the city’s heritage and quality property on offer.”
He said “long-term serious property investors” did not seem to be put off by recent increases in tax for higher priced properties and second homes.
Meanwhile, Stuart Montgomery, director of lettings for Rettie, said the switch from London to Edinburgh had been spotted in previous years. He put the change down to investors considering the Capital a “safer” and more “robust” bet when compared to other UK cities, with its market sharing similar features to London.
The news comes as average rents in Edinburgh are set to hit £1000 a month for the first time. Figures compiled by Citylets found rents were up 6.6 per cent year on year.
Graeme Brown, director of Shelter Scotland, said the rise was “alarming” and would “worry renters across Edinburgh, many of whom are already feeling overwhelmed by the increasing pressure of sky-high housing costs”.
Alison Johnstone, Green candidate for Lothian, said the boom in investors risked driving up prices for other buyers, adding: “This will be a kick in the teeth for tens of thousands of people in the city renting privately or trying to save up to buy their first home. Sky-high housing costs are one of the main drivers of stark inequality in Edinburgh and a major drag on the city economy, by diverting investment away from productive small businesses and social enterprises. That is why we need radical action to reduce land costs, through the Greens’ plans to reform planning laws and to replace the council tax, hitting the property speculators where it hurts.”
An ESPC spokeswoman said there had been a “high demand” for buy-to-let properties in the lead-up to the new second home tax being introduced on April 1. But she insisted the company had not seen a “huge rush” of London investors buying up flats, adding: “The Scottish Government has introduced measures that could allow for rent control, so that tenants won’t be faced with increased, uncapped rates, so a surge in London investors would be unlikely to affect rent, unless they are purchasing higher quality properties which would attract higher rents.”