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The pace of annual rent growth in Scotland dropped by two thirds in 2014 with average rents now just 1.2% or £6 higher than a year ago, the latest index figures reveal. This follows a monthly drop in average residential rents, down 0.4% in December to £536 per month, according to the Scotland Buy to Let Index from Your Move, one of Scotland’s largest lettings agent networks. It means that growth has slowed from a 3.9% annual jump in rent prices seen in 2013 but Edinburgh and the Lothians has bucked the trend with annual rent growth over the past year from 2.5% in December 2013 to 4.5% in December 2014. ‘Annual rent growth braked sharply over 2014, reducing the speed of rent rises to a sustainable and affordable pace. This is providing some welcome relief to the thousands of renters itching to jump on the housing ladder, who are already faced with enough hurdles to saving a deposit,’ said Christine Campbell, regional managing director of Your Move. ‘This wider downturn in growth during 2014 marks a return to the natural market rhythm. Scottish rents were holding fast on an even keel throughout 2011 and 2012, until the abolition of tenancy fees in November 2012 sparked a new tide of unnaturally steep rent hikes,’ she explained. ‘This should act as cautionary tale for policymakers considering further constricting changes to lettings legislation. The rental market is thriving by its own hand, and too much undue intervention may poison the current climate of affordability,’ she pointed out. ‘Scaring landlords out of the rental market would exacerbate the current housing shortage, and wound thousands of tenants as competition hots up. Buy to let investment is a vital remedy for the current housing shortage, and for the health of tenant finances,’ she added. A breakdown of the figures shows that overall, rents are higher than a year ago in three out of five regions of Scotland. After a strong acceleration in the pace of growth during 2014, average rents in Edinburgh and the Lothians have seen the fastest year on year increased at 4.5% in the 12 months to December. A 2.2% annual rise in Glasgow and Clyde takes the average monthly rent to £559, however this still represents a significant deceleration in the pace of annual rent growth, declining from 7.3% a year previously. While rents climbed consistently across all regions of Scotland during 2013, the slowdown in rent growth witnessed during 2014 has been more severe in some cases with two regions experiencing annual falls in rent prices. Average monthly rents in the Highlands and Islands are now 2% lower than December 2013. The South was the only other area of Scotland to experience an annual fall, with average rents down 1.8% over the past 12 months. The average monthly rent in the South of Scotland now stands at £484, down from £493 a… Continue reading →
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