York is the most affordable city, with monthly rents £78 cheaper than the national average. The Welsh cities also performed well, with both Cardiff (14% of monthly income spent on rent) and Swansea (15%) in the top 5 most affordable. These were driven by the cities particularly cheap monthly rents.
Jonathan Moore, director of Easyroommate.co.uk, said: “York was hit hard with the recession, and some of the largest local employers like Network Rail and Norwich Union cut jobs. As a result, there was sharp increase in homeowners looking to rent out spare rooms to help pay the mortgage – pushing up the supply of rental accommodation. And although the local economy is on the up, rental increases have lagged behind. There is almost a perfect situation for renters. The average rent is 28% below than the UK average, and most renters are taking home a substantial wage – just twelve pounds per week off the UK average. This means renters in more affordable areas like York are able to pocket the difference from their pay-check and put it towards saving for their first deposit.”
Southampton is the least affordable city with 27% of the average income being spent on rent – 11% higher than the national average. London is the second most unaffordable city. Despite having rents of £551 pcm, the highest in the UK, Londoners enjoy higher average wages (£2,594 per month). This meant that rent was 21% of the average income was spent on rent.
Jonathan Moore comments: “London is by far the most expensive city for renters to live in – but higher personal incomes in the capital soften the blow of the mammoth living costs. In Southampton, flatmates are not so lucky. Although rents are sky-high, the average resident is taking home nearly £700 a month less than the average Londoner.
Southern cities have highest monthly rents in the UK, but the South East emerged as by far the most expensive region to rent a room. All five of the most expensive cities to rent are located in the South East. London has the most expensive rents for flatsharers, while the London commuter hotspots Guildford (£505 pcm), Cambridge (£418), and St. Albans (£410) all feature in the top five. Southampton is the second most expensive city, with average rents reaching £516 pcm.
In contrast, three northern cities, York (£270 pcm), Stoke (£275) and Hull (£287), are amongst the cheapest cities to rent in. In fact, a renter could afford a room in both Stoke and York for the cost of renting just one room in London.
Jonathan Moore continues: “There’s a clear split between the North and South – but the South East is looking increasingly like a separate market entirely. The squeeze in supply of properties has been felt more keenly in London and its outlying satellite towns, where demand is highest – and rents are in London have soared to double those seen in York. For the price of renting a room in the South East, prospective flatsharers could rent whole properties elsewhere in the UK!”
Jonathan Moore forecasts: “Getting a mortgage is almost impossible for thousands of first-timers – and this unlikely to ease in the next few years. With public sector spending cuts on the way, unemployment will rise. Fewer people will be able to afford to buy properties – or rent on their own. This will push up demand for flatshare, and rents will continue to soar. We expect the monthly rents to rise by 10% across the UK over the next two years, with an increasing gulf between the rental market in the South East and the rest of the UK. But despite the imminent public sector job losses, the financial services sector shows signs of recovery, and more jobs are becoming available in London. As demand for accommodation from young professionals grows, we anticipate the cost of room rental in London to top £600 per month.”
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