"For existing and prospective landlords, this is a market with solid fundamentals with rents rising, demand remaining good, and reasonable purchase prices"
- Adrian Sangster - DJ Alexander
Aberdeen property investment is attracting fresh attention, with lower house prices and rising rental income combining to create what Scotland's largest lettings and estate agency describes as an attractive and sustainable opportunity for landlords and investors.
DJ Alexander, which operates across Scotland as the country's largest lettings and estate agency, points to a £7,517 fall in average house prices over the past 12 months, bringing the city average to £128,485.
That represents the largest price decrease of any Scottish region and leaves Aberdeen among the most affordable cities in the country, despite the city recording the second-highest average wages in Scotland at £39,822.
The presence of a well-paid, transient workforce in the oil and gas sector adds further appeal. Many of those workers require rental properties for extended periods, providing a reliable stream of demand for private rented sector (PRS) accommodation, the second-highest.
Demand for residential property has softened amid uncertainty over the political direction of oil and gas policy, but there are growing signs that both the UK and Scottish governments are moving toward increased drilling activity and approving existing licences. Should that shift materialise, Aberdeen could see an influx of well-paid workers seeking rental accommodation, supporting both rental income and longer-term capital growth.
The Citylets Q1 2026 report confirms that rents are already moving in the right direction. The average monthly rent rose 1.7% year-on-year to £878, with two-bedroom properties up 1.8% to £812 per month and four-bedroom homes up 5.3% to £1,661. Some 42% of properties let within a month, with an average time to let of 45 days.
"There is a very positive message about the sector in Aberdeen, which is potentially on the cusp of an increase in property prices coupled with greater demand in the PRS," said Adrian Sangster, head of property management and letting at DJ Alexander in Aberdeen.
"In response to recent events, the political consensus is shifting toward a recognition that oil and gas will be required by the UK for decades to come, and it makes more sense to drill in the North Sea than import from across the world. For existing and prospective landlords, this is a market with solid fundamentals with rents rising, demand remaining good, and reasonable purchase prices."
Scotland also offers a tax advantage not available elsewhere in the UK. "For investors, an added incentive is that Scotland is the only part of the UK offering attractive tax relief on the purchase of properties for the PRS," Sangster continued.
"The two main methods of tax relief are multiple dwellings relief (MDR), which is available for purchases of two properties or more in a single or linked transaction, and the Additional Dwelling Supplement (ADS), which is usually charged at 8% but, combined with MDR, does not apply to purchases of six properties or more. Utilising these reliefs with appropriate advice can produce cost reductions of tens of thousands of pounds on the purchase price."
Regulatory and cost pressures on landlords are acknowledged, but the investment case remains solid for those operating professionally. "While landlords have faced significant regulatory, tax and cost pressures in recent years, there remains a strong investment case, particularly for those with good quality properties, realistic pricing and professional management," he said.
"The strongest demand continues to be for well-presented homes in good locations, particularly one and two-bedroom flats and family homes in areas with strong access to employment, transport and amenities. Citylets data shows flat yields of 9.8% in AB24, 8.6% in AB11, 8.4% in AB25 and 7.8% in AB10, which are compelling figures for investors looking for income rather than short-term capital speculation. Tenants are more value-conscious than they were during the peak of the market, but they are still prepared to move quickly for the right property."
The fundamentals, Sangster argues, ultimately come down to how investors approach the market rather than whether they enter it at all. "The key is not simply whether to stay in the market, but how to stay in the market successfully," he concluded. "Presentation, pricing, compliance and proactive management are all essential.
"A property that is well maintained, marketed correctly and priced in line with current demand can still perform very well. For investors, Aberdeen is a long-term income market with lower entry costs and strong yield potential. For many landlords, that balance between affordability and rental return is exactly what makes the city attractive. For landlords and property investors at all levels, Aberdeen offers good potential returns for years to come."
