Rents across Scotland have continued to increase, driven by a combination of landlords exiting the market and the introduction of rent control measures. This trend poses significant challenges for landlords and letting agents as it affects rental income and the overall dynamics of the private rented sector.

Rising Rents Reflect Market Pressures

New data from the Scottish government reveals that average rents have risen across all property sizes. One-bedroom properties now command an average rent of £738 per month, up 4.0% (£28), while two-bedroom properties have increased by 3.1% (£28) to £921 per month. Three-bedroom properties have seen a smaller rise of 1.6% (£18), reaching £1,154 per month.

These increases come amid growing concerns from the Scottish Association of Landlords (SAL), which attributes the rent rises to landlords leaving the sector in response to anti-investment rhetoric and the introduction of rent controls under the Scotland Housing Act. The Act, which recently gained Royal Assent, empowers ministers to implement long-term rent control measures.

Impact of Rent Controls and Landlord Exodus

John Blackwood, Chief Executive of SAL, emphasises that the rise in rents was “sadly inevitable” given the current climate. He explains that landlords are increasingly discouraged by the political environment and regulatory changes, leading some to exit the market. This reduction in available rental properties places upward pressure on rents due to increased demand.

Blackwood warns that rent controls, while intended to protect tenants, often have the unintended consequence of pushing rents higher. He states, “We warned the Scottish government that this was also a foreseeable consequence of rent controls, which always pushes rents up wherever they’re tried.” SAL remains committed to advocating for a balanced private rented sector that supports both landlords and tenants.

Regional Variations in Rent Increases

The data also highlights regional disparities in rent changes. For the most common property size, two-bedroom homes, rents increased in 16 of Scotland’s 18 Broad Rental Market Areas (BRMAs). In 12 of these areas, the rent rises outpaced the UK’s 12-month Consumer Price Index (CPI) inflation rate of 3.1%.

The largest increase was recorded in Dumfries and Galloway, where two-bedroom rents rose by 13%, or £64 per month. Conversely, some areas saw declines: Dundee and Angus experienced a 5.3% (£43) fall, while Lothian saw a marginal decrease of 0.1% (£2).

Implications for Landlords and Letting Agents

For landlords, these developments underscore the importance of staying informed about legislative changes and market trends. Rent controls may limit the ability to increase rents in line with costs, while a shrinking landlord base could mean higher demand and potential for increased rental income in some areas.

Letting agents should prepare for a more complex rental market, balancing tenant affordability concerns with landlords’ need for sustainable returns. Understanding regional rent variations will be crucial for advising clients accurately and managing expectations.

Looking Ahead: Support for Landlords

In response to the evolving landscape, the Landlord Association (TLA) is launching a new Trusted Partners Hub in Q1 2026. This initiative will feature verified and approved service providers tailored to support landlords, tenants, and property management businesses. Service providers in legal, trades, insurance, financial, mortgage, tenant screening, and related sectors are encouraged to register their interest to join the Hub.