Under new proposals from the Government, new rental properties are expected to have a minimum EPC rating of C by 2025. And by 2028, that is expected across the board. Tightening the rental market in such a fashion has already had an impact on landlords, forcing many of them to either sell or start investing cash in their properties before the deadline.
Current data shows that around 10% of landlords have started to sell their tenanted properties and that about 7% argue that their properties will never get that EPC rating of C. On the more positive side, over 20% have already made the necessary improvements and have achieved the minimum EPC rating of C. A similar proportion of landlords are currently in the process of making their properties more energy efficient.
Is It Worth Investing in the Buy-To-Let Property Market?
Despite the tighter regulations around rentability of properties, the Glasgow buy-to-let property market is still very much worth it for investors. The only thing that you need to decide upfront is whether you’d be happy to purchase a property and upgrade it to meet the new regulations, or if you’d prefer to buy a property that is already C-rated. Of course, this would largely depend on your budget and long-term plans as a landlord in Scotland’s biggest city.
In 2023 alone, demand outstripped supply once more, causing rental rates to rise in the double digits, despite the Government’s attempt at setting a rent cap. In Glasgow alone, rents year-on-year have been up by 14.4%, which is a big win for landlords looking to profit.
A Forecast of Glasgow’s Property Market
Currently, supply and demand remains an issue. In Glashow alone, some agents get over 100 enquiries per property advertised, meaning the demand for rental properties is still high. Both landlords and economists believe that the Glasgow buy-to-let property market will continue to soar, as properties rise in price and become more difficult to acquire.
So, if you’re planning on investing in Glasgow’s property market, don’t be afraid of doing so. Those who have already made this decision are profiting nicely and will likely continue to do so as Glasgow becomes a powerhouse in Scotland.
The Best Areas to Invest in a Buy-to-Let in Glasgow
Glasgow is Scotland’s biggest city. And as a result of that, it attracts tens of thousands of new students and residents from different parts of the country each year. This is great news for buy-to-let investors as the more people there are, the higher the demand, which will, in turn, increase the prices of rental properties.
With that said, there are a handful of areas that are far better for buy-to-let investors compared to anywhere else in the city. And below, we’ll cover the ones you should definitely know about.
Glasgow City Centre
With a population of around 50,000 (and rising), Glasgow’s city centre is one of the hottest areas for rental properties in the whole city. According to the city council, the population within the city centre is expected to at least double by 2035.
This opens up a massive opportunity for investors looking to get into the market right now. The average property price in the Glasgow city centre is around £208,400 while the rental yield varies between 5% and 15%, which is data that will make any property investor happy.
Home to around 92,000 residents, Glasgow’s West End is one of the city’s most popular residential areas. It’s especially popular amongst younger professionals and families. Not only that, but Glasgow’s University is located in the West End, meaning there is a huge population of students looking to rent a property in the area too
Some of the most popular parts of West End for renters include Hillhead (which is mostly for students), Dowanhill, Anniesland, Broomland, and Kelvinside. The average property price in West End is £252,736, which is around £50,000 more than the city’s average.
With that said, the property prices across West End have and are expected to keep rising as demand increases. So, the sooner you get in the market, the better.
Located on the opposite side to West End, East End is a larger and still massively popular part of Glasgow amongst residents. This is mostly because East End sits right on the edge of the Glasgow City Centre, allowing everyone that lives in the area easy access to the city.
Currently, the area is home to about 110,000 people and the average property sells for around £186,000, which is almost £70,000 cheaper than the West End. Still, rental yield in this part of Glasgow averages around 7.2%.
With the Government’s new proposal of making rental properties more energy-efficient, all landlords are forced to ensure that their properties are at least EPC C-rated by 2028. This has caused some uproar amongst landlords, causing some to sell their properties while the majority were willing to invest cash in upgrading their rental properties.
If you’re a potential investor in Glasgow, the buy-to-let market still holds the opportunity for investors to profit in the long-term. This is especially true now more than ever, with property prices and rent going up each year.