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England

Over half of London’s private renters struggle with housing payments, as rents rocket

Posted 07 Apr 2016

New research from housing and homelessness charity Shelter has revealed that a staggering 54% of Londoners renting privately are struggling to pay their rent.

The Shelter and YouGov study of private renters in London – the largest of its kind – found that London's renters are buckling under the pressure, with 1 in 3 falling into debt in the last year in an effort to meet their monthly housing payments.

The figures are even worse for families, with almost half (47%) having to borrow money, resorting to measures such as payday loans, credit cards or borrowing from family, to make ends meet.

Millions of Londoners are finding themselves caught in a 'rent trap' – spending vast amounts of their income on rent each month and priced out of a home of their own. The latest government figures show that rents have risen by 19% in London in the last 5 years alone. And while the average rent for a two bed flat in the Capital is now over £1,600 a month, wages have not kept pace.

Campbell Robb, Chief Executive of Shelter, said: "With rents rising relentlessly, far too many Londoners are having to fight hard to keep their heads above water.

The charity is calling on the next Mayor of London to provide greater stability for London's private renters, by introducing longer tenancies with rent rises
limited to inflation rates, and developing a strategy for building more homes
that Londoners on ordinary incomes can actually afford to rent or buy.

"Tens of thousands of people are either being pushed out of the city, or are
spiralling into debt just to be able to keep a roof over their heads – borrowing money from family or going into the red on credit cards.

"London's 2.7 million private renters deserve better. The new Mayor can help to make unstable renting a thing of the past – so it's up to every mayoral candidate to show they're willing to fight for London's renters."

Case study: Hayley, 34, lives in Camden with her two flatmates and is finding it increasingly difficult to afford to live in the city, despite working full-time in marketing.

"I've lived in London for 8 years, and I've had to move 7 times – I'm about to do so again because my landlord's increasing the rent and I just can't afford my flat anymore. I'm paying more than half my salary on rent already, and the rest goes on bills and living.

"Even in the time I've lived in London, I've seen steep increases in rent across the city, and a lot of landlords getting rid of living space to cram an extra bed
in. It feels like London is really starting to lose its magic."

ENDS

Shelter is calling on the new Mayor of London to help put an end to unstable,
unaffordable and unsafe renting.

Notes to editors:

  • Survey results are from a YouGov survey of 3,792 private renters in England, 739 of whom lived in London. 111 of the London renters had children living in their household. The survey was carried out online in July 2015, and was weighted to fit the demographics of the GB private rented population.

The survey showed that:

  • When asked: 'Some people can easily afford to pay their main outgoings, others find it more difficult to pay. Thinking about your situation, how easy or difficult is it for you to pay your rent?'; 54% of London renters answered 'I/ we are keeping up, but struggle from time to time' or 'I/ we are keeping up, but it is a constant struggle' or 'I/ we are falling behind with payments'

  • When asked: Which, if any, of the following have you sacrificed/ done in order to enable you to keep up with any rental payments over the last year (i.e. since June 2014)? (Please select all that apply); 34% of London renters said at least one of: Borrowed money from parents / Borrowed money from friends/ other family / Borrowed from bank or building society / Borrowed from credit card / Borrowed from payday loan / Borrowed from overdraft. 47% of London renters with children said one of these.

  • Rent inflation figures are from the ONS Index of private housing rental prices. The rent inflation figure in this release is for the period March 2010 to March 2015, which was selected to enable like-for-like comparison with wages data. Figure 1 below, shows this comparison. Taking the last five available years (Jan 2011 to Jan 2016) produces an even higher rent inflation figure for London – 20.4%.

  • Current average rental prices are taken from VOA private rental market statistics. The ONS index above does not provide actual rent price averages. Two bedroom averages for each London borough are shown in figure 2 below.

An infographic showing London rent inflation compared to London wage inflation

Source: VOA private rental market statistics, 2014-15 (October 2014 to September 2015)

Table: Average rents for London area

LONDON£1,626
Inner London£1,940
Camden£2,196
City of London£3,238
Hackney£1,809
Hammersmith and Fulham£1,839
Haringey£1,512
Islington£2,032
Kensington and Chelsea£3,072
Lambeth£1,609
Lewisham£1,268
Newham£1,247
Southwark£1,748
Tower Hamlets£1,766
Wandsworth£1,731
Westminster£2,875
Outer London£1,330
Barking and Dagenham£1,001
Barnet£1,407
Bexley£971
Brent£1,472
Bromley£1,159
Croydon£1,120
Ealing£1,490
Enfield£1,263
Greenwich£1,292
Harrow£1,272
Havering£972
Hillingdon£1,218
Hounslow£1,480
Kingston upon Thames£1,387
Merton£1,520
Redbridge£1,115
Richmond upon Thames£1,677
Sutton£1,134
Waltham Forest£1,191