The Rental Market Q1 & Q2 2021
Q1
According to the latest rental indices for 2021 from LandlordZone using data from Belvoir, Q1 of this year revealed that rents fell slightly year-on-year across the UK.
The data shows a minimal fall across all UK regions including Scotland, with the average rent for Q1 sitting at 1% lower than the same period last year.
Given the catastrophic effect of the pandemic, it is surprising that rents have held up.
Q2
In the second quarter of this year, there were more positive results across the country where supply couldn’t keep up with demand. Rents in Q2 rose by 1.25% and there was a slightly bigger year-on-year increase of 1.5%.
Trends
Houses have outperforming flats from a rental and purchasing perspective with the pandemic exacerbating demand across all markets.
Trends do differ across regions and property type with houses in the most demand. In the second quarter of 2020, prices for flats decreased by 16%. Houses performed better, with no falls reported in Q2 this year. Overall, landlords with houses saw rent remain strong throughout the pandemic – and these are no increasing in all regions.
House prices
For landlords with a portfolio, it’s important to understand not only rental income but also what is happening to house prices across the UK. According to data from Walker Fraser Steele and Acadata, the average house price in Scotland hit a fresh high of £211,029 at the end of August 2021. This is a monthly rise of 1.8% which equates to £3,685 since July, and a 12.1% annual rise – with no sign of a let up.
In addition, all 32 Scottish local authorities have reported price rises over the year so far, and that transaction levels in August were at a seven-year high.
House prices from June to July stood at 2.7% and was a six-year high so the latest increase.