London rents increase by 25 per cent in six years

Capital

Rental prices in the capital increased by 25.9 per cent between 2011 and 2017, while wages rose by just 9.1 per cent over the same period.

These prices reflect the cost of renting a two-bedroom flat, which, according to this data, now costs an average of £1,500 a month in the capital.

Elsewhere in the UK rental prices outstripped wage growth, with the rental costs increasing by 18.2 per cent compared to just a 9.8 per cent increase in salaries over the same period.

The average cost of renting a two bed-flat across the UK is now £650 a month.

These figures were compiled for the GMB Congress, and highlight growing affordability problems in the rental market. The GMB has called on employers to increase salaries to address this imbalance.

The problem is particularly acute in many London boroughs. Greenwich has seen the biggest increase in rental costs, with rents jumping by 50 per cent over this period. Wages in the area have increased by just 7.2 per cent.

Other London borough to see significant rises in the cost of renting property include Newham (up 47.4 per cent), Barking and Dagenham (up 42.4 per cent) Lewisham (up 42.1 per cent), Sutton (up 40.6 per cent) and Waltham Forest (up 40.1 per cent).

In Redbridge rental pries are up by 38.9 per cent, while wages have increased by just 3.3 per cent.

All figures are based in data from the Office of National Statistics and the Valuation Office, while compiles data from landlords and letting agents about rented properties.

GMB regional secretary Warren Kenny says: “In Greenwich the cost of renting a two bedroom flat now absorbs about 70 per cent of the average net pay of a resident in the borough.

“These high rents are here to stay. Younger workers are living for longer in private sector rental accommodation.

“If employers don’t respond with higher pay offers they will face staff shortages as workers, especially younger people, are priced out of the housing market.”

He adds that the “chickens were coming home to roost” on policy mistakes made in the past. This includes a failure to build sufficient homes which are available to rent at reasonable rates.

More news and analysis on London house price news. 

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