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

The latest rental data from Citylets, combined with the most recent house price information from ESPC, shows that there were three postcodes in Edinburgh that offered the best rental yields for buy-to-let investors during July to September.

Properties in the sought-after EH3 district performed especially well, as increasing numbers of young professionals and families alike sought rental properties in the highly desirable New Town. With easy access to the city centre, as well as being close to the tram line and trendy areas such as Stockbridge and Leith, this area has experienced notable demand from renters. 

One-bedroom properties in EH3 achieved an average rental yield of 7.3 per cent during July-September 2023, while two-bedroom properties offered a yield of 6.2 per cent. Larger three-bedroom homes had an average rental yield of 5.9 per cent.

Homes in the EH12 postcode also performed strongly during the third 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 provides excellent local amenities and first-rate transport links. 

In this postcode, one-bedroom properties performed strongest, with an average gross rental yield of 7.3 per cent, while two-bedroom homes had a yield of 6.8 per cent, and three-beds offered 5.3 per cent on average.

The postcode area of EH4 offers an ideal investment opportunity for landlords, with this part of the city continuing to be hugely popular with families and young professionals alike. Spanning areas such as Stockbridge, Barnton, Cramond and Blackhall, EH4 offers great access to the city, the coast and green spaces alike, as well as good schooling options and transport links. 

One-bedroom homes in EH4 provided a rental yield of 6.5 per cent during the third quarter of 2023, while two-bedroom homes offered 7.2 per cent on average, and three-bedroom homes had an average yield of 6.0 per cent.

Nicky Lloyd, head of ESPC lettings, says: “Throughout 2023, Edinburgh’s rental market has continued to be under staggering levels of demand, with many more renters looking for homes than there are available properties. Even during traditionally quieter periods, we are continuing to see huge demand for homes in the city which we expect to see carry on into 2024.

“Properties of all sizes have seen a rise in demand, but one-bedroom properties have been especially popular, while two-bedroom homes have experienced the largest rise in rental rates. Average rents have, once again, reached an all-time high in Edinburgh, and competition continues to be fierce for quality homes of all types and sizes, in many areas across the city.”