The latest rental data from Citylets, combined with the most recent house price information from ESPC, shows that there are four postcodes in the capital that offered the best rental yields for buy-to-let investors during the period July-September.
Close to the heart of the city, and with plenty of surrounding green space, properties in EH8, spanning Meadowbank, Willowbrae and Abbeyhill, are traditionally more affordable than those in the city centre, and are popular with families, young professionals and students alike. Between July to September, the average rental yield for one-bedroom properties in EH8 was 5.1%, while it was 5% for two-bedroom properties and 5.6% for three-bedroom properties.
Directly south of the city centre, properties in the EH9 postcode – covering Newington, Marchmont and The Meadows – also performed well in terms of rental yields. Homes in EH9 offer residents the opportunity to enjoy the capital’s delights at close quarters, while having access to green spaces and a trendy village feel of its own, and being so close to the university campuses, properties here are especially popular with the student population.
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One-bedroom properties in EH9 achieved an average gross rental yield of 5.4% in the third quarter of 2021, while two-bedroom properties produced an average yield of 3.7%, and three-bedroom homes achieved 4.6% on average.
To the south-west of the city centre, rental yields in EH11, including the popular pockets of Dalry, Gorgie, Shandon and Stenhouse, also performed strongly, with an average yield of 5.6% for three-bedroom properties in this area, 5.1% for two-beds, and 4.8% for one-bedroom homes.
Finally, homes in the prestigious and ever-popular EH3 postcode, which includes New Town, Inverleith and Warriston, present a good long-term investment option. One-bedroom properties in EH3 achieved an average gross rental yield of 5.4% in the third quarter of 2021, while two-bedroom properties achieved 4.6%, and three-beds achieved 5.2%.
Nicky Lloyd, Head of ESPC Lettings, said: “The market over the third quarter has been frenetic, with tenants acting on properties within minutes of them being made available, same-day deposits being placed on a number of homes, and even some tenants moving in the same week that homes have been advertised. The demand has been especially strong in areas traditionally popular with students and young professionals, which is consistent with the patterns of the best-performing rental yields.
“One-bed properties in the New Town and Newington and The Meadows are unsurprisingly popular, as are larger three-bedroom homes in the neighbourhoods of Holyrood and the Southside, and Gorgie, Dalry and Shandon, which are all popular locations for the student population.
“Average rents are up across most property types in Edinburgh, and we are seeing a real spike of activity from prospective tenants looking for a home in the city. Good-quality properties are in high demand, particularly for those larger properties, such as three-bedroom homes, which have seen a positive rental increase of 5.8% in the last year alone.”
For more from ESPC, or to view properties currently on the market, visit espc.com.