London Tenants Need to Earn Over £21k Just to Cover Rent

Tenants in London need to earn over £21,000 per year just to cover the rent, according to new research.

The average rent price in the capital grew to £1,467 a month in October, up from £1,402 in June, says the Rentify Property Index. This is more than a £21,000 annual salary, which provides an income of £1,447 per month after tax.

The study revealed that rents in London increased by 4.67% since June, with the greatest rises recorded in Greenwich.

Rents in Greenwich increased by £340 per month, followed by a rise of £210 a month in Brent and £197 per month in Newham.

Most expensive London boroughs to rent in

London Tenants Need to Earn Over £21k Just to Cover Rent

Could these price rises be the result of the announcement that buy-to-let landlords will see their mortgage interest tax relief cut?

Earlier this year, Chancellor George Osborne revealed that this change would be gradually introduced from April 2017. By reducing the amount of tax relief that landlords can claim, investors could lose thousands of pounds per year.

Chief Executive of Rentify, George Spencer, says: “The high cost of rent in central London is continuing to drive people away to outer boroughs in search of affordable housing. This however, means that these so-called cheaper locations are seeing a remarkable rise in rent due to their popularity. They are hot on the heels with central London due to strong demands.

“Furthermore, the recent buy-to-let tax hike introduced by the Chancellor will further constrain supply as less people invest in property to rent, making life increasingly hard for Londoners.”¹ 

Rents dropped in areas such as Wandsworth, by £33 per month, and Kingston-upon-Thames, by £90 a month.

Cheapest London boroughs to rent in

¹ http://www.dailymail.co.uk/property/article-3333353/Tenants-London-need-earn-salary-21k-just-cover-rents-s-not-including-bills.html