Exceptional rental yields in Scotland are attracting investors from the UK and internationally, according to Robert Ross, director of Glasgow-based sales and letting agency Ronald Ross.

He says the company is matching high-end investors with property opportunities and achieving yields of up to 9% – and often significantly higher, he claims – against a sector average of 5% to 7%.

As well as stronger yields, he says that investors are also attracted by the caveat in the Additional Dwelling Supplement (ADS) in Scotland, which exempts buyers of more than six properties from the tax if they are owned by the same landlord or company. 

He says that makes them immediately 8% better off than if the homes were bought individually and also attracts lower commercial LBTT rates.

Ross said: “Tenant demand remains firm and transaction activity is stable, creating opportunities for investors who are well-capitalised and properly advised.

International interest and London-based investors

“Interest is evident from buyers in the Far East, the UAE and the US but, with lower house purchase prices in Scotland, the difference in yields is a big plus point for London-based investors and there are far fewer pitfalls around leaseholds and service charges.”

Ross said that the interest from larger investors with deeper pockets is also benefiting smaller landlords who are keen to exit the sector in the face of increasing regulatory burdens.

He said Ronald Ross is also helping distressed mortgage holders whose properties are about to be repossessed by helping them sell to investors who can conclude purchases quickly.