Since interest rates started going up in late 2021, property investors have been keeping a close eye on market trends to find the best opportunities in the best areas. According to a recent analysis by the peer-to-peer real estate investment platform easyMoney, Edinburgh has emerged as one of the top cities in the UK for property investment returns.
The city has seen a notable increase in property prices, with a rise of 9.1% since late 2021. This growth has made Edinburgh one of the go-to places for property investors looking for solid returns. With its mix of lively neighbourhoods, strong rental demand, and a positive economic outlook, it's no surprise that Edinburgh is catching investors' attention.
Recent reports from Edinburgh property portal ESPC, combined with rental data from Citylets, have pinpointed the areas offering the best rental yields in the second quarter of 2024. The EH11 postcode, which includes areas like Gorgie, Dalry, Polwarth, Shandon, and Slateford, has been particularly attractive for buy-to-let investors. These neighbourhoods are not only up-and-coming but also close to Edinburgh Napier University, making them popular with students and young professionals.
In EH11, one-bedroom and two-bedroom properties delivered solid rental returns of 6.4% and 6.3%. Two-bedroom properties delivered rental returns of 6.4%, and three-bedroom properties offered a whopping 7.8% yield—the best in Edinburgh during this time. This proves it’s not just students and young professionals that are attracted to this area, but families, too. Plus, with EH11 being so close to Murrayfield Stadium, there’s a great opportunity for landlords to benefit from short-term lets for visitors attending major sports and music events.
1F4, 5 Smithfield Street, Edinburgh, EH11 2PH | Guide Price: £100,000+
This one-bedroom flat in the EH11 postcode of Edinburgh could earn you solid 6.4% rental returns. It's an ideal location for students of Edinburgh Napier and is also a 15-minute walk from Murrayfield Stadium.
Other postcodes showing strong rental yields include EH3, covering the New Town and West End; EH12, which features areas like Corstorphine, Murrayfield, and Saughtonhall; and EH8, home to neighbourhoods like Meadowbank, Willowbrae, Abbeyhill, Holyrood, and parts of Newington and the Old Town.
The lifting of rental regulations in the second quarter of 2024 has also given the Edinburgh rental market a boost. Demand remains incredibly high, particularly for one-bedroom and three-bedroom properties, driven by students, young professionals, and families looking for their perfect home.
Despite some economic uncertainties, Edinburgh's property market is still full of potential for landlords. With strong rental demand, diverse and appealing neighbourhoods, and a stable economy, the city offers plenty of opportunities for investors ready to step into the market and meet the growing need for quality housing.
