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Lettings
EXPERT ADVICE

How is the rental market performing?

Recent data from Citylets illustrates how the private rental sector in ...inflation steadily fell through the year, and interest rates
Scotland performed during the final quarter of 2025.
declined, easing pressure on landlords with mortgages.

verall, there was a welcome sense England did face income tax changes. Scotland
of calm after a year marked by chose not to follow suit immediately, though
O uncertainty in both the wider economy the possibility remains open in future budgets,
and Scotland’s private rental market. keeping investors cautious.
Looking ahead to 2026, economic uncertainty
Much of 2025 was shaped by the Housing On a more positive note, inflation steadily fell remains likely. Oil price volatility, global
(Scotland) Bill becoming law, alongside through the year, and interest rates declined, political tensions, and potential strains within
global economic turbulence. Changes to US easing pressure on landlords with mortgages. international alliances could create new
trade tariffs created instability worldwide, This brought some financial relief, and further challenges. However, if inflation stays under
with ongoing legal debates in the United rate cuts are widely expected. Rental markets control, improving mortgage conditions and a
States adding to market nerves. While easing in major Scottish cities also began to stabilise, more balanced rental market may offer some
tariffs may benefit exporting countries, the with supply and demand becoming more reassurance for the sector.
overall effect has been a lingering sense of balanced than in recent years.
unpredictability in global trade. The average rent in the capital saw a modest
Inflation dropped sharply from 4.4% at the increase compared with the same quarter last
In the UK, budget announcements were start of the year to just 0.2% by year-end. year, as the typical cost of renting in Edinburgh
heavily influenced by rumours, particularly After years of rapid rent growth, rental prices grew 0.2% year-on-year to £1,167. As with the
around potential changes to stamp duty and largely levelled off across most cities, with previous quarter of 2025, it is safe to say that
landlord taxes. Although many proposed affordability - rather than demand - now the Edinburgh rental market is going through
measures were not introduced, landlords in acting as the main limit on further increases. a period of stabilisation following the strong
growth recorded in 2023 and 2024. On average, it took 25 days for rental listings
in Edinburgh to find a tenant, three days
Four-bedroom properties experienced the longer than the same period last year. One-
highest rental growth, with average rents bedroom properties were the fastest to be let,
increasing by 3.3% to £2,517, reflecting averaging just 19 days on the market. 81% of
sustained demand from families seeking one-bed properties were let within a month,
larger city homes. As one-bedroom properties and 21% of these let within the first week,
saw a slight 0.7% year-on-year rise to £1,079 showcasing how quick the market is.
and three-bed homes grew 1.4% to £1,890,
the average rental cost of two-bedroom rents If you’re interested in entering the buy-to-let
dipped marginally by 0.1% to £1,443. market or are a landlord looking for advice,
ESPC Lettings can help. As a letting agent
Credit: BBA Photography/Shutterstock.com with open market levels, rent reviews have stages of renting out a home, from finding the
Following a period of rent realignment
based in Edinburgh, we can assist with all
moderated, contributing to a more stable and
right property to sourcing tenants to property
maintenance.
evenly balanced rental market.

espc.com | 31
30 | espc.com ESPC Lettings is an Edinburgh letting agent. Get in touch with the team today on landlord@espc.com or 0131 253 2847.