The property portal ESPC has revealed the top-performing Edinburgh postcodes in terms of rental yields, for the second quarter of 2023.

Using a mix of the portal’s own data along with stats from Citylets, the results highlight three postcodes in the Scottish capital that offered the best rental yields for buy-to-let investors during the April to June this year.

The postcode area of EH8 offered the best rental opportunity for landlords during this period, as this part of the city became even more popular with families and young professionals alike. Spanning areas such as Holyrood, Meadowbank, Abbeyhill and Willowbrae, EH8 offers – according to ESPC – “great access to the city, the coast, and green spaces, with plentiful amenities and excellent transport links, making it a very popular choice for a wide variety of tenants.” 

Three-bedroom properties in EH8 offered the best return on investment across the city, with an average gross rental yield of 7.7 per cent during the quarter under review. One- and two-bedroom properties both reported a strong average rental yield of 5.8 per cent. 

Properties in the up-and-coming district of EH11 also performed well, as this area becomes more popular with students and young professionals in particular. Areas such as Gorgie, Sighthill and The Calders have increased in popularity in recent years, thanks to the excellent transport links and more affordable prices. 

Three-bedroom properties in this postcode area achieved an average gross rental yield of 7.4 per cent during this period, while two-bedroom properties reported a 6.0 per cent yield, and one-bedroom homes offered a yield of 6.1 per cent.

Homes in the EH12 postcode also performed strongly during the second quarter of 2023, with properties here proving popular with a range of renters. Located to the west of the city centre, and covering neighbourhoods such as Corstorphine, Murrayfield, Hermiston and Saughtonhall, this postcode offers a variety of homes suited to students, young professionals working in the city and families looking for a home close to good schools and green spaces, plus it offers excellent local amenities and first-rate transport links, thanks to the bus and tram routes close by. 

In this postcode, one- and two-bedroom properties performed strongest, with an average gross rental yield of 6.1 per cent, while three-beds offered 5.8 per cent on average.

Nicky Lloyd, head of ESPC lettings, says: “Edinburgh’s rental market continued to be incredibly busy during the second quarter of 2023, continuing the patterns that we’ve been seeing for many months now. There continues to be issues of high demand and low stock, and as we head into the traditionally busiest period of the year for renting, there seems to be no sign of things slowing down. 

“Rents for new tenants continue to rise, to offset the impact of the Scottish Government’s rent freeze, but this doesn’t seem to be impacting the numbers of tenants looking for a rental property in Edinburgh. 

“Properties of all sizes continue to be in high demand, but one-bedroom homes flew off the market the fastest, while two-bedroom properties saw the largest rise in rental rates, and according to this data, three-bedroom homes generally reported the largest rental yields. It is, in short, a thriving market for property investment at all levels, as the fierce demand for Edinburgh shows no signs of waning.”