Dundee is a coastal city in Scotland nicknamed ‘The City of Discovery.’ With a population of around 150,000, the city has been transformed in recent years and now looks set to become Scotland’s buy-to-let capital.
Buy-to-Let Market Trends
UK rents have risen to their highest point on record, due to rising mortgages and demand exceeding supply. As a result, the buy-to-let housing market has grown steadily throughout 2023 despite rising interest rates, and people are continuing to invest in buy-to-let properties across the UK.
The Scottish city of Dundee is an excellent example of the booming buy-to-let market. Dundee saw the highest increase in rents during the past 12 months, figures show. With a 16.9% year-on-year rent increase, Dundee was even ahead of the Scottish capital, Edinburgh, as well as Glasgow and Aberdeen.
These are just the latest figures that confirm a strong year for Dundee’s property market. In the second quarter of 2023, Dundee had the highest average rent increase across all sizes of property.
Dundee’s Property Market
A significant factor in Dundee’s buy-to-let boom is the relatively low barrier to entry for those looking to invest in property. Property prices haven’t risen as quickly in Dundee as they have in other Scottish cities, such as Edinburgh, meaning landlords can build a portfolio of properties for a fraction of the cost.
As a result, landlords are increasingly keen to invest in Dundee property, where they can expect high rental yields. As such, the city’s buy-to-let market is expected to see continued growth.
Infrastructure and Development
The property market in Dundee is also benefiting from recent investments in infrastructure and economic development in the area.
With excellent transport links, including regular rail services to and from Aberdeen, the city appeals to both commuters and those wanting to be within easy reach of other areas of Scotland, including Edinburgh.
Other projects that have increased the city’s overall appeal include the regeneration of the waterfront and the proposed development of the Dundee Eden Project. The city is also going to be home to a brand-new, 4,000-seat e-sports arena. The Northern Lights Arena Europe (NLAE) is set to be the world’s leading digital and online gaming hub and the waterfront arena is set for completion in 2024.
Demographic Factors
Explore demographic shifts or changes in population dynamics that may contribute to the rise in demand for rental properties in Dundee.
Demand for rental property in Dundee has also been buoyed by its two universities, the University of Dundee and Abertay University. Students from the nearby St Andrew’s University are also increasingly choosing Dundee as a base.
As well as a growing student population, renters are being drawn to the city thanks to Dundee’s growing life sciences and biotech sector centred around Ninewells Hospital and Medical School.
Conclusion
Multiple factors are influencing the growth in Dundee’s buy-to-let market, including its economic development and large student population. The sector looks set to go from strength to strength as the city embraces its future as one of Scotland’s top cities and demand for rental properties continues to grow.
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