Tenants in London are now spending 70% of their average income on rent and bills, according to new, concerning research.
A study conducted by Portico London estate agents has found that three and half days wages are typically needed to fund rents, taxes and household bills.
Capital rents spiralling
The research from Portico suggests that the average worker in London has around £201 in disposable income to spend on food and luxury items.
Analysis was conducted on a borough level, adjusting the value of rent, council tax and travel to zone 1 accordingly. Using the average London yearly salary of £34,320, the investigation found that Londoners renting in Bexley had the largest amount of disposable income leftover following rent and bills with £287.
At the other end of the scale, renters in the City of London were found to have the lowest amount of disposable income at the end of each week, with just £32.
Tenants in London spend 2/3’s of income on rent
Skyrocketed
Robert Nichols, managing director, commented, ‘Londoners have to work increasingly later into the week before they start to spend some of their hard-earned money. Working for five hours alone to pay income tax, plus almost two days on rent, clearly shows how private rents in the capital have skyrocketed.’[1]
‘But while rents are increasing, public transport is also improving significantly, so we’re seeing a huge number of tenants move further out to boroughs like Bexley, Barking and Dagenham and Ealing to benefit from affordable rents, a quick commute, (which will become even better with the arrival of Crossrail) and a good sum of disposable income in their pockets at the end of each week,’ Nichols added.[1]
[1] https://www.landlordtoday.co.uk/breaking-news/2016/6/londoners-now-spending-more-than-two-thirds-of-income-on-rent