London renters pay more than double rest of the UK
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Rents in London are more than twice as expensive as elsewhere in the country averaging £1,560 according to a new report.
The HomeLet rental index for October 2015 showed that tenants in London paid 7.5 per cent more per month than in the same period last year.
Ben Felfeli of C.H. Peppiatt said: “Rents in the borough of Camden have definitely gone up around that much. For example, we were letting a one-bed for £380 last year; this year we let it for £410.
“It’s a simple supply and demand. Property prices have gone up so people can’t afford to buy, while many existing tenants are staying put. Demand is high so landlords are putting rents up, partly because they can, partly because agents provide comparable rents in the area and advise clients to go with the rest of the market in the area. Also, there are a lot more landlords so letting has been a lot more competitive. Landlords are investing more in their properties to make them higher quality.”
This is far higher than wage growth, which has seen the average incomes of tenants rise 1.7 per cent this year, meaning many Londoners are being stretched even further beyond the limits of their budgets by soaring rents.
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Affordable rent in the UK is defined as 35 per cent of income after tax, but the English Housing survey found that many Londoners are paying as much as 74 per cent of their net salary towards housing each month.
With high rents leaving little financial wiggle room, 54 per cent of those surveyed said they were not currently saving for a deposit although 71 per cent said they would prefer to buy than rent.
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Unsurprisingly, the report found that price was the primary factor for tenants when choosing a home, with 86.6 per cent of renters responding that it was important compared to crime rates, parking, commute times, attractive surroundings, public transport or local amenities.
Despite rising numbers of families renting, 61.7 per cent of respondents said that local schools were not very important when choosing where to live.
The overall UK average rent was £997 per month, an increase of 9.7 per cent since October 2014, with Scotland (9 per cent), and the East Midlands (5.9 per cent) experiencing the fastest price rises outside London.