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Is Edinburgh a Good Place to Invest in Property

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Is Edinburgh a Good Place to Invest in Property
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As a property investor, Edinburgh is a great area for you to consider. Property prices are on the rise, and Edinburgh is the only Scottish city to make it onto a top-ranking list for residential investment opportunities in the UK.

But what do you need to consider when choosing Edinburgh as your next location for property investment? Don’t worry; here at We Buy Any Home, we’ve completed all the research for you, making your decision a much easier one.

Trust in We Buy Any Home to make your property investment journey much less stressful.

What does Edinburgh’s rental market look like?

Edinburgh’s rental market is very promising for potential investors, with an average monthly rent of £2,551. There are currently 805 properties to rent in Edinburgh, with over 170 properties added to the rental market in the last 14 days. These figures show the significant demand for properties to rent in Edinburgh, with this popularity showing no signs of waning any time soon.

The population of Edinburgh has been rising for many years, with it soon expected to pass 500,000 people. It is the 2nd most populated Scottish city after Glasgow, with just under 600,000 citizens. With this rising population, it’s no wonder we’re seeing a high demand for rental properties.

This is further encouraged by the rise in property prices, with an average asking price for a property in Edinburgh of £389,362 (February 2023). This is an increase of 9% when comparing the average asking price in February 2022 of £358,677. As rent generally increases with rising property prices, it’s clear to see why the rental prices in Edinburgh are continuing to go up.

What rental yield can investors expect?

Investors can expect a rental yield on Edinburgh properties of 7.86%, based on an average asking price of £389,362 and an average monthly rent of £2,551. 

A good rental yield is considered to be between 5% – 8%, indicating that Edinburgh is an excellent area to invest in, given its high rental yield.

How can you become a landlord in Edinburgh?

With these great figures, we’d be unsurprised if you want to know more about becoming a landlord in Edinburgh. Considering Edinburgh is a popular area for families, students, working professionals and retirees, you won’t be short of demand when looking at tenants for your Edinburgh investment property.

So, what must you do to become a landlord in Edinburgh? Check out the below points to get a head-start with this process.

Ongoing property costs

Ongoing property costs are essential when looking to become a landlord in Edinburgh. While you may be able to afford the initial costs of purchasing a property, there will be ongoing costs to bear in mind, too, in order to ensure the upkeep of a rental property.

These are likely to include the following:

  • Mortgage repayments (unless you’re a cash buyer)
  • Tax on rental income
  • Estate agency costs
  • Set-up costs (property cleaning, certificates etc.)
  • Ongoing maintenance fees

Once these points have been considered and understood, you can start looking for the best area in Edinburgh to purchase your rental property.

There are many factors to consider when buying a house, as renters will look for certain benefits when browsing the rental market. Here are a few points to look at when choosing where to purchase your rental property:

  • Price
  • Local amenities
  • Schools
  • Environmental factors

Looking for a Newcastle property

Hopefully, you’ve used the above points to narrow down where you’d like to purchase a property in Edinburgh. You’ll find that there will be a combination of properties available to buy on the traditional market as well as at auction.

Auction properties involve buyers bidding a specific price for a property rather than having a set asking price as with a traditional sale. These properties tend to be cheaper but will require significant work to make them rentable. While these properties can be more time-consuming, they can yield better profits, particularly if you have experience in property renovation.

Once you’ve found the property you want to buy, you’ll need to consider whether you need to take out a buy-to-let mortgage. This will enable you to have a mortgage on a property and rent it out for profit. Of course, this won’t be applicable to you if you’re a cash buyer and are purchasing the property outright.

You’ll also need to consider whether your property is up to date in terms of the latest fire/safety regulations. This is vital when renting out a property – estate agents may be able to assist you with the regulations required should you decide to outsource your property management.

Property management

The next step in becoming an Edinburgh landlord is to think about management for your property. Some experienced landlords prefer to handle this themselves; if this is your first investment property, it may be wise to consider outsourcing property management to an estate agent. Estate agents do charge for their services; however, this is likely to save you time and can be helpful in ensuring all appropriate steps are taken when it comes to managing a property.

Property management usually includes the following services:

  • Finding tenants
  • Taking rent payments
  • Maintenance correspondence
  • General overseeing of property (regular inspections etc)

Landlord insurance

The last step to consider in your journey to becoming an Edinburgh landlord is landlord insurance. Available from most large insurance companies, landlord insurance protects you financially from emergency situations such as flood and fire, as well as issues arising due to broken boilers and the like.

It’s worth looking into landlord insurance to avoid being out of pocket in case these unlikely events were to occur. Some landlord insurances can include fixtures and fittings, but you’ll need to check this with your insurance provider and tailor your insurance plan to your property/needs.

Landlord insurance can be taken out via comparison websites or by contacting insurance providers directly. You may be advised to take out landlord insurance by your mortgage company, as some mortgages will require insurance to be used before they’re formally agreed upon.

What happens if you want to stop investing?

If you’ve invested in an Edinburgh property and make the decision to stop investing, We Buy Any Home is here to help.

We are the biggest cash buyer in the UK and regularly purchase Edinburgh properties with tenants in situ to assist landlords in achieving a quick sale. This can be helpful if you have a good relationship with tenants and want them to be able to remain in the property, as many buyers won’t be interested in purchasing properties with tenants already in situ.

Providing you have the relevant tenancy agreements in place, we can purchase your property without the need for your tenants to move out. To get the ball rolling on this process, simply get a free cash offer via our website – we’ll be in touch shortly to provide you with an offer and get your property sold in as little as seven days!

Free cash offer within minutes, any condition, any location.

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