Rental affordability hits decade high in the north while London is still the most unaffordable
The latest research by Zoopla shows that rental affordability in the North is at its highest in a decade, while London predictably remains the most unaffordable region.
- Rents are set to rise with earnings
- Demand is strongest in the South East
- Occupancy numbers are often overlooked when considering rental affordability
Co-founder of flatshare platform, Tom Gatzen, commented:
“Despite the slowdown in the London sales market, the high cost of buying in the capital continues to put pressure on the rental sector despite weaker rates of rental growth and as a result, the capital’s tenants aren’t really feeling the joy in the current market climate.
While the available earnings may be higher than elsewhere, the high cost of living also continues to put pressure on those stuck in the rental sector and London continues to lead the way in terms of the most unaffordable city for UK tenants.
Of course, as this report suggests, one area that is rarely considered is occupancy levels and I think the consistent issues surrounding affordability are the driving factor behind the increasing trend of co-living in the capital.
For many, opting to share a house or flat with others is one way of beating the London rental market at its own game and by sharing the cost, not only can you address affordability issues, but you can improve your quality of life and level of disposable income.”
Callum Brannan, CEO and founder of Howsy, commented:
“This latest data highlights the diversity of the UK rental market and how the ratio of earnings to rents varies from region to region, with the most affordable mix not necessarily home to the highest earnings.
We’ve seen recent uplifts in wage growth and and an acceptance by landlords that tenants can only pay so much in rent in order to service, both of which have helped boost rental affordability, particularly in the northern regions.
Of course, the more inflated markets see rental affordability remain fairly restricted and a lack of suitable stock will only exacerbate that in the long run.
In addition to this, with changes to the buy-to-let on the horizon, there is a wide expectation across the industry that tenants will bear the brunt of any financial loss and this could see a further reduction in rental affordability across the board.”