Increased rental demand in Scotland
Published: 07-Apr-2008
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The credit squeeze has boosted Scotland's buy-to-let market, forcing many potential first-time buyers out of the market, an expert claims.
According to Diarmid Mackenzie Smith, head of estate agents Rettie & Co, there has been "good take up of any good quality property on offer" within Scotland as a result of the current economic climate, particularly in prime locations in Edinburgh.
"With the effects of the so-called 'credit crunch', first-time buyers will now come back into the rental sector which will explain the increase in rental demand and signs of rental increases that have recently been experienced," he explained.
The credit crunch has adversely affected the banking industry and consumers are finding it more difficult to access credit, with First Direct announcing this week that it has closed to applications for new mortgages, while Nationwide has restricted lending, particularly to first-time buyers.
Figures from the Bank of Scotland indicate that the annual rate of house price inflation in Scotland for the fourth quarter of 2007 was 13.1 per cent, the strongest increase in the UK.
The Scottish housing market remains relatively strong, registering a price rise of 2.4 per cent in the last quarter 2007, compared with a 0.8 per cent drop across the UK.
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