Here’s a round-up of some recent Edinburgh residential property market news which should make interesting reading for Edinburgh landlords.
Edinburgh crowned top UK city for economic growth
Lambert Smith Hampton published their annual Vitality Index and reports that Edinburgh pips Cambridge (2nd) and Manchester (3rd) as the UK city with the best prospects for economic growth. Edinburgh has jumped from 5th spot last year and has seen one of the highest rates of house price growth and strong wage growth.
he city has a highly qualified population and is forecast to see one of the strongest rates of job growth in the next 5 years. Our recent blog highlighted the impressive figures for Edinburgh in recent years and LSH’s index is further proof that the future looks bright for Edinburgh.
Demand for Edinburgh student property keeps coming
According to Knight Frank’s Global Student Property report for 2019 Edinburgh is a hotspot for investment in student accommodation; the 3rd most popular UK location (behind London and Birmingham). Current full-time student numbers outweigh Purpose Built Student Accommodation (PBSA – modern blocks of student flats owned by one party; normally a pension fund) bed spaces by a ratio of more than 3:1 with this imbalance set to increase; Edinburgh’s student population is expected to rise from around 50,000 to 60,000 by 2025 (and only 3,000 new bed spaces are in the development pipeline). Around 1/3rd of full time students in Edinburgh are from outside the UK (a 15% increase in the last 5 years).
Knight Frank’s report focuses on the PBSA sector however a growth in student numbers in Edinburgh can only be good news for landlords with buy to let properties. Edinburgh Council has identified that more PBSA is needed to relieve the pressure on the traditional flats within the Private Rented Sector (PRS) as rents continue to climb due to the supply-demand imbalance.
Over-50s now make up 15% of rented households in Britain.
The Herald Newspaper reports an 11% increase in rental homes occupied by over-50s since 2012, with 1/3rd of this group being pensioners. Around 40,000 retired adults are privately renting; some unable to get on the property ladder.
Across the UK almost 800,000 properties were rented by over-50s (61% more than in 2012 and up 8.2% in the last year). According to the research most older renters live in 2 bedroom properties (44%), 26% in 3 bedroom properties and 19% living in a 1 bedroom home.
Good news for Edinburgh as M&G Prudential plans more jobs in the city.
The insurance and finance firm is reducing its UK locations from 7 to 3, with the Scottish and London offices the only to survive these cuts (by 2025). Around 450 jobs will be transferred from Stirling, Reading, Chelmsford and London to a recently formed wealth solutions business in Edinburgh within a new office at the Gyle Business Park (with capacity for 700 staff).
According to the article, “Edinburgh is the UK’s largest financial services centre after London and one of the world’s top 10 fintech hubs”. Alongside HMRC moving 3,000 jobs to a new hub at New Waverley in 2020, these Prudential employees will put further pressure on the Edinburgh rental market with more tenants competing for properties on the market.