Average monthly rents hitting record high of £549

The cost of renting a home has risen by just over 3 per cent compared with last year, according to new data.

The average monthly rent in Scotland is now at a new high of £549, the latest Scotland Buy-to-Let Index from Your Move has reported.

It found that growth in Scottish rents accelerated to 3.1 per cent in the year to June, up from 2.7 per cent in May and 1.6 per cent in April.

June’s figure represents the fastest year-on-year increase since April 2014, when annual growth stood at 3.5 per cent.

Landlords’ total annual returns stand at 13.8 per cent in June 2015, up from 9.5 per cent a year previously, while there is evidence that some tenants are struggling, with 9 per cent of all rent paid late - an increase from 8.8 per cent in May.

Glasgow and Clyde saw the biggest boost in rents year-on-year, with typical rents up 4.6 per cent since June 2014.

Rents in the Highlands & Islands have jumped 4.3 per cent in the past twelve months, taking the average monthly rent to a record high of £563.

Similarly, rents in the East and South of Scotland have both reached a new peak following annual rent rises of 4 per cent and 2.1 per cent respectively.

In contrast, Edinburgh & the Lothians has experienced the smallest yearly increase of only 0.8 per cent.

Brian Moran, lettings director at Your Move Scotland, said: “The volume has been cranked up in the Scottish rental market after a muted winter and a much faster beat of rent rises is now audible.

“Rents are hitting all-time local records in the parts of Scotland that have traditionally been more affordable to live, where rental prices are lower.

“It’s not just the big urban centres of Edinburgh and Glasgow which are coming up against an urgent shortfall of housing - there is furious demand for homes to let the length and breadth of the nation, and that is underpinning this build-up in rental prices.

“The delicate market equilibrium may also be imbalanced by the ripples of the summer Budget.

“With landlord’s tax relief compressed, the vital bedrock of the private rented sector - investment - could fall short of what’s required to meet the towering demand on the market.

“Greater supply of homes to let is the only way to definitively address the housing shortage and ease the financial pressure in the market.”