Released on: October 16, 2008, 6:53 am

Press Release Author: Holyrood Partnership

Industry: Real Estate

Press Release Summary: This report provides clearest evidence of the fundamental
changes in Scotland's property market. It shows that people are turning their backs
on buying property and turning to rent instead in record numbers. What's more, it
also points to how more increasing numbers of people who cannot sell their property
because of the housing market slump are now becoming 'reluctant landlords'.



Press Release Body: Scotland's property market is experiencing seismic changes as
people turn their back on house buying in favour of renting, according to latest
research by Scotland's leading online letting portal Citylets.

Unprecedented levels of demand from people who have been frozen out or put off
buying because of the credit crunch have lead to a surge in rental properties being
snapped up over the last three months.

The latest Citylets quarterly report, Trends in Scottish Residential Lettings, also
revealed that high demand is now being matched by a boom in supply with significant
numbers of the new listings coming from so-called 'reluctant landlords' or people
who are putting their homes up for rent because they cannot sell or don't want to
sell in a difficult market.

The report, covering the period July-Sep 2008, showed there was a 38% increase in
properties let and a 55% spike in new rental accommodation coming onto the market -
compared with the same period in 2007.

Rents have risen again for one and two bed flats across Scotland, another sign that
young professionals and couples are no longer buying

Thomas Ashdown, Managing Director, of Citylets said: "There's no doubt we are seeing
a significant change in the make-up of Scotland's property market.

"The collapse in confidence in the property buying market has seen an enormous
swathe of potential home owners divert into rentals.

"But one of the most telling aspects of what has been a dramatic quarter has been
the surge in new properties coming onto the market. To see an increase in stock
levels against a background of record demand is quite remarkable.

"Normally, stock levels show an increase in supply throughout the first half of the
year, then decline sharply in the third quarter and stay fairly low throughout the
last. This year things started in a similar fashion, but stock levels over the last
three months have grown considerably."

Thomas said while some of the growth may be attributed to an increase in new
Citylets clients over the period, he has no doubt other social factors are
contributing.

He added: "What we have seen in the last quarter reflects common sense expectation.
The immediate effect of the credit crunch was an increase in rental demand followed
by the onset of a slump in property sales which in turn has now fed rental supply.
It is all connected.

"The slowdown in the property market has seen a new wave of 'reluctant landlords' -
home owners or small-scale property developers who are unable or unwilling to sell
in the current markets - looking to rent out their homes.

"This really is an astonishing period for the Scottish rental market - we've never
seen anything like it."

www.citylets.co.uk was launched in 1999 and is Scotland's most successful lettings
portal. Its quarterly report is the country's only detailed and independent
barometer of the rental market, based on 30,000 annual lettings through 200 agents.
It is now a respected tool among investors, landlords and letting agencies.

The report shows that average rents in Scotland rose by 4.3%, compared with
July-September 2007, with levels for one bed flats in Edinburgh, Glasgow and
Aberdeen showing the biggest annual hikes.

Rents for a one bed flat in Aberdeen shot up by 9.5% - letting on average in only 18
days - while similar flats in Edinburgh and Glasgow rose by nearly 6%.

Thomas added: "The recent period has been great for letting agents and landlords but
it is important to be aware that things can change. If demand peaks and supply
continues to climb there will be pressure on rents to flatten as has happened in
other countries such as Ireland.

"That said we are less exposed to dramatic change in Scotland as, despite the best
efforts of our banks, we have not been as reckless and the sales market doesn't have
as far to fall."

* A copy of the report is attached or is available online at
www.citylets.co.uk/reports/

ENDS

Issued on behalf of Citylets by Holyrood Partnership. Contact Raymond Notarangelo on
(0131) 561 2244 or info@holyroodpr.co.uk.



Web Site: http://www.citylets.co.uk/reports/

Contact Details: Bonnington Bond
29 Breadalbane Street
Edinburgh
EH6 5JW

Tel: 0131 561 2244
Email: info@holyroodpr.co.uk
Website: http://www.holyroodpr.co.uk/