Edinburgh named the second least affordable Scottish city for renters

On average, just over a third (37%) of a tenants' take-home pay is going on rent here.

A new report has revealed the most and least affordable Scottish cities for renters in 2024 (so far) – and Edinburgh just narrowly missed the top spot.

Overall, Stirling came out as the least affordable Scottish city to rent in (it took fourth place in the UK-wide table), with tenants here typically seeing 43.5% of their net (take-home) income going on their rent. The national average is around 5% less (38%).

Edinburgh was the second least affordable Scottish city to rent in, with around 37% of income going on rent here. It had the highest average monthly rental cost per named tenant though at £745.

Edinburgh is the second least affordable place to rent in Scotland

The insight comes from tenant and landlord services provider Canopy who have released their inaugural rental affordability index.

Dundee was revealed to be the most affordable Scottish city for renters, as tenants here are spending a more reasonable 30.5% of their take-home pay on their rent (on average) – 7% less than the UK national average.

Dundee was also named the second most affordable UK city to rent in when looking at the net ‘rent to income’ ratio. It was followed by Aberdeen.

Rent in Dundee is currently averaging £534 per named tenant, while in Aberdeen it is slightly lower at £531.

Using almost 50,000 data points, the Rental Affordability Index paints a comprehensive picture on the correlation between income and rental costs across the UK.

It shows that the majority of UK tenants have rental costs that are at the very limit of what experts believe is ‘affordable’.

The Canopy experts advise that spending around 30% of gross (pre-tax) income on rent is typically considered affordable, while 40% is at the outer limits of what many can make work. Most UK renters are currently going above this.

Across the UK, over a quarter (27.3%) are spending at least half of their take-home (net) salary on rent.

In Stirling, nearly half (46.7%) of tenants are spending over half of their salary on their rent. In Dundee, this is much lower at just 12.5%.

Overall, Belfast is the most affordable major city for renters in the UK, with the average tenant spending just under a third of their take-home salary in rental payments (29.1%).

Despite a reputation of being unaffordable, a high average income means that London (39.9%) has an affordability ratio than is only just above the UK average (38%).

Chris Hutchinson, CEO at Canopy, commented: “It is sobering to see that more than a quarter of UK tenants are spending the vast majority of their take-home salary on rental payments, and it neatly encapsulates the tricky situation that many tenants with aspirations of home ownership are in.

According to our latest data, renters are spending 38% of their take-home income on rent vs 18% for homeowners paying mortgages. That highlights the financial pressure on renters, meaning less money is able to be saved to achieve their goals.

Despite the price stability that further regulation would have on the market, there would likely be additional disincentives for landlords, leading to more leaving the market, and therefore reducing rental housing supply, or those remaining being less inclined to adequately maintain their properties. Where we could see positive change is towards longer tenancies for those who desire them, fostering greater security for families and communities.”