Scotland was one of three areas to have posted record returns for landlords in the last five years.

The latest quarterly report from the Association of Residential Letting Agents (ARLA) shows that the average rate of return over five years on cash purchase properties in Scotland was 11.08 per cent, almost a whole percentage point above the national average of 10.81 per cent.  Scotland also featured top of the list for gross annual rental yields. The UK average stands at 4.81 per cent compared to 5.23 per cent in Scotland.

The figures are important because landlord sentiment can affect both the supply of properties coming on to the market (if landlords decided to leave the market) and demand for properties.  But positive returns and strong demand for rental property are sustaining investor confidence in the private rental sector. 

ARLA reports that the percentage of landlords who say that demand for rental property is higher than supply was the second highest since ARLA's surveys began more than five years ago.  And a survey by the association reveals that nine out of 10 landlords said that they had no intention of selling their properties for at least another 17 years.