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Edinburgh is a capital city of world renown - known as the
capital of Scotland, one of Europe's major financial centres,
and Scotland's top tourist attraction with August's Film, Jazz,
Fringe and International Festivals, along with Hogmanay celebrations.
On top of all of this Edinburgh continues to experience
excellent growth, with forecasts for the next 10 years showing
population increase in the immediate area in and around the
city of around 50,000. This in itself will provide a generator
for the letting and selling market with the inhibitions
created by Edinburgh policies on green belt and building conservation.
Edinburgh is experiencing an economic boom with financial
and educational institutions leading the way at the same time
as Scotland's young Parliament grows and establishes itself
on the world stage. The power house of a devolved Scotland is
firmly based in Edinburgh and as the Parliament matures the
city's exposure in Europe in particular will get bigger.
Recent articles about property in Edinburgh (PDF format):
"Know your
REITS to cash in on hot property" - Scotsman, 2 April 05
"Edinburgh
UK's second most prosperous city" - Scotsman, 3 March 05
"Cost of home leaps as buyers invest" - The Scotsman, 01 Feb 2006
"Low yields see DJ Alexander open the door to single-night tenants" - The Scotsman,
17 October 2006
:: Property in Edinburgh
'The average house price in Edinburgh (for the second quarter of 2006) has now reached over £200,000
according to the ESPC local sources, compared to 2001 when the average price in the capital had just exceeded £100,000.
Population growth means that brown field sites in the city are much in
demand and are selling for many millions of pounds. Limited supply of
this type of land and constraints caused by the sea to the north and
green belt to the landward side mean meeting the demand of this population
growth is difficult. Planning restraints due to much of the city being
either a world heritage centre or conservation area add to the problem.
Currently house prices are rising and under the circumstances described
and assuming interest rates remain within a range of 4.5-5%, Cullen support
selective purchase of property.
Read our comments on the Edinburgh Property Market
Read "A Brief History of Investment in Residential Property
in Edinburgh"
:: Letting Market
The letting market is healthy across the board. Cullen specialises in
the quality end of the student market (3,4 and 5 bedroom flats) and
in the professional/executive market for 1 and 2 bedroom flats in the
city centre.
Lettings to students are normally for 12 months so it is feasible to
achieve the pleasant situation of continuous income. The rents range from
£250/425 for double rooms very much depending upon which part of the
City the property is located.
Professional lettings are for a minimum of 6 months; many people are
now coming to the city on contract and need the flexibility given by
the Short Assured Tenancy, which also gives the landlord rights of
repossession at the end of the lease. Due to the buoyant employment
market this sector of the market place is very active for well
located central flats.
Read
our comments on the Edinburgh Property Market
See the average rental
movements over the last 9 years (or)
download in PDF format)
If you are a current landlord, we can rent your flat for you as well.
Warning
We do not recommend that our clients buy new two bed city centre
properties since we feel that there is either already an over
supply of them in the rental market or will be.
As letting
agents, we have seen their rents slide in the last 5
years and predict they will continue. Yields are low. Many
amateur investors buy these as investments because of the
convenience, and this has created an over supply.
Most Edinburgh developments, 30-50%, are bought for investment.
However, many investors use the indicated rental rates provided
by the developers to appraise viability. This is a rash decision
to make and we do encourage investors to consult with a reputable
letting agent to find out an independent assessment of the rental
level. We frequently find that the developers may guarantee a rent
of, say £800 per calendar month, for a 2 bedroom flat and whilst
this sounds very comforting the reality is that the rental level
will go down to the market level, which may be as much as 20 -
25% less than what the developer as agreed to guarantee for only 1 year.
Contact us for more information.
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