Glasgow’s lettings market is the strongest it’s been for up to a decade, with a shortage of rental flats driving demand and prices, according to local letting agency Rosevale Letting.
“Rental returns are the strongest we’ve seen for the last seven to eight years or maybe even ten years,” said Riccardo Giovanacci, the agency’s founder.
“This time three years ago, a one-bed flat in Glasgow’s West End might have rented for £650 to £700 a month, or maybe £750 on a good day. Now that same flat will be going for £1,000 a month.”
For a one-bed flat in Glasgow being marketed at the height of summer, Rosevale Letting can receive in excess of 150 enquiries within 24 hours.
Lack of rental stock has been the main driver behind an “unbelievably strong” last couple of years, Giovanacci added, with many landlords choosing to leave the market.
“Property values have rapidly increased and a lot of people who had become accidental landlords over the last ten to 15 years had an opportunity to get out of the market,” he said. “But those landlords aren’t being replenished.”
Increasing legislation in the private rented sector, fewer tax breaks and a switch to holiday let sites like Airbnb were also driving landlords and their properties out of the market, he said. But demand for rental property has continued climbing, especially since the end of the Covid lockdowns.
“In the autumn and winter of 2020, there was an excess of stock, but the market took off like a freight train the following summer, and it hasn’t really stopped since then,” Giovanacci said. “Historically there were always peaks and troughs in the market. But in the last two years, it’s just got stronger and stronger.”
Giovanacci hopes new Scottish government legislation on short-term lets will bring some landlords back into the private rented sector, but says “only time will tell”.
He believes rental demand and rents in Glasgow will continue to grow meantime.
“I think we’re still going to see growth running into next year, and if we keep losing stock at the rate that landlords are exiting the market, it’s only going to get stronger and stronger in terms of pricing,” he predicted.
Rosevale Letting currently lets and manages around 700 properties for around 400 landlords and has seven staff.
Giovanacci formed the business after acquiring the lettings arm of property factoring specialist Newton Property Management four years ago.