Rents in the second quarter of this year crept up to a record high in Scotland amid tightening supply in a number of city hotspots – as the Scottish Government seeks more regulation of the sector.

Scottish lettings portal Citylets said that average rents were £762 as of yesterday – a rise of 5.4% compared with a year ago.

Aberdeen rents, still the highest of all Scotland’s key cities, fell from £1,089 last quarter to average £1,043 as fall-out from reduced oil sector activity continues to bite.

In Edinburgh rents rose to stand at £923 per month, up 7.3% on last year.

Thomas Ashdown, founder of Citylets, said: “With the Scottish Government currently consulting on matters central to the new tenancy regime, including localised rent controls, it is highly noteworthy to report that Aberdeen has just recorded negative annual growth for the first time in years.

“This will be music to the ears of those supporting free market economics.

“Aberdeen has often been cited by those in support of controls as evidence for intervention, but now I believe the city best highlights the ability of markets to self-regulate.

“Surveys and academic analysis suggest increased regulation and decreased control for landlords will reduce supply.

“Whilst large swathes of the country continue to enjoy a balanced market, local hotspots continue to suffer from a dearth in supply and can ill afford to see it further compromised in any way.

“With the removal of ‘no fault’ grounds for repossession already confirmed, one must hope that common sense will prevail to ensure a new granular system to provide for the niche student market which depends on a fixed end date culture.

“This is particularly so for Edinburgh where it fits hand in glove with the need for short-term Festival accommodation.”