The buy-to-let market in Scotland has remained resilient throughout 2016 and continues to offer enticing rental yields for landlords, according to CKD Galbraith.
Despite heightened economic and political uncertainty, not to mention a raft of legislative changes within the private rented sector, the property consultancy reports that it has experienced solid demand from buy-to-let landlords seeking good quality investment properties north of the border, with particular interest received from the 55-plus demographic with pension lump sums at their disposal.
In April this year the 3% levy on second homes came into force and next year will see the introduction of the Private Tenancies Act replacing the current letting system in Scotland. Many expected such changes and uncertainty around Brexit to adversely impact on the letting market and deter those considering investing in buy-to-let properties. However, CKD Galbraith believes the letting market remains strong with both property supply and demand remaining steady.
The firm’s experience mirrors the findings of a recent report published by BM Solutions, the buy-to-let brand of Lloyds Banking Group, which indicated rental yields have remained strong with Scotland showing an average of 6.3%.
Bob Cherry, partner at CKD Galbraith, commented: “The lettings market in Scotland still represents a sound investment opportunity for those looking to put their savings into bricks and mortar. As always, the vagaries of the buy-to-let market are subject to regional trends but overall demand remains especially strong from those who have reached or are approaching retirement age.
“Recent changes to pension schemes has resulted in many people choosing to withdraw savings as a lump sum and invest the money into a market that offers attractive yields. With the Bank of England base rate having been cut to 0.25%, suitable buy-to-let properties offering an average yield of around five to seven per cent are often preferable to savings accounts and ISAs which might not offer such good interest rates.
“Property is still viewed as one of the most popular and safest forms of investment for large sums of money, and with the right advice, can offer landlords a very appealing and long term investment option given the continued shortage of good quality housing supply.”