With Londoners spending 70% of income on rent
Despite news this week that the housing market has seen its first slump since 2012, the same can’t be said for the rental market – especially in the capital.
Rents continue to climb, and are showing no sign of slowing. Tenants in the UK are seeing the cost of privately renting a property rise far faster than incomes, and the increase has far overtaken house price growth according to a new report from the Royal Institute of Chartered Surveyors (RICS).
The report predicts that rents in the UK overall will increase by an average of 4.7% year-on-year for the next five years, compared to a purchase price increase of only 4.1%.
In addition to a less-than-rosy future, there has been more immediate bad news for tenants this week, in the form of a report published by Homelet which revealed the costs of the average tenancy across the UK. Without taking the predicted rises into account, the average tenant is currently paying 4.4% more in rent today that they were in May 2015.
The price growth was led by Scotland, where rents rose a whopping 10.6%. This was closely followed by increases of 8.6% in the East Midlands, and London at 6.2%.
Despite not topping the table, it’s not good news for London’s tenants. Further research showed that they are now spending a huge 70% of their monthly income on rent and bills – with the average Londoner working until 1pm on a Thursday every week before they have covered their essential living costs.