Short-term holiday lets fuel rise in Edinburgh rents

THE growth in short-term holiday lets has helped drive a five per cent increase in rents in the Capital.

Friday, 29th March 2019, 5:00 am
The growth of short-term holiday lets has helped drive an rent increase.

A report by letting company Your Move showed rental prices in Edinburgh had risen by three times the national average of 1.7 per cent over the 12 months to February.

The report said the average rent in Edinburgh and the Lothians was now £699 per month - the highest in Scotland.

David Alexander, of city estate agents DJ Alexander, said the boom in Airbnb and other short-term lets was undoubtedly a big factor in the rise in rental prices.

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He said: “There has been a surge in property moving across to short-term rental and when that comes off the longer-term rental market it means there is less property and all that does is push prices up.

“Edinburgh is a very strong long-term rental market and property is always in demand. There is already a shortage of supply so when landlords opt for Airbnb it means there is even greater pressure with the inevitable result of higher prices.

“It’s not the only reason for rising rents but it is definitely a factor.”

But he said some landlords were not tempted by the short-term market. “Not everyone wants to go into Airbnb. Some prefer a long-term tenant who will look after the property and they know they have a rent coming in.”

Letting company Citylets recently put the increase in Edinburgh rents at 7.8 per cent and predicted “a continuing rise over the course of 2019”.

It found one-bedroom flats had increased by 8.5 per cent and four-bedroomed homes by 10.3 per cent.

Recent documents released by the Scottish Government under Freedom of Information legislation showed Edinburgh had 9000 Airbnb listings - an increase of 43 per cent in 12 months. In the city centre, the number of listings worked out at one for every 11 residents.

The Your Move report showed the area with the biggest increase in rental prices was Highlands , where the rise was 7.3 per cent.

Airbnb listings in the Highlands saw an 81 per cent increase over 12 months.

Analysts said another factor in the rise of rental prices - added to the popularity of Edinburgh as a place to live - was the recent introduction by the Scottish Government of Private Residential Tenancies (PRT) which offer tenants increased security of tenure and fewer grounds on which they may be subject to eviction.

Brian Moran, national lettings director at Your Move Scotland, said: “The desirability of the Scottish capital remains strong and Edinburgh is becoming more popular among renters.

“Not only is there increased demand among young professionals to live in the city centre, but the introduction of the PRT means we’re seeing a shift in the type of properties on the market.

“There is more demand from families looking for larger homes in commuter areas thanks to the increased security provided by these tenancies. This means that larger properties that command higher rents are coming to the market, increasing the average rental price in Edinburgh.”