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London rents unaffordable

Rent Watch London, part of Shelter’s Homes for London campaign, looks at how much families would need to earn to be able to affordably rent a typical two-bedroom home.

It found that a family would need to take home almost £3,500 each month, equivalent to a yearly pre-tax salary of £52,000. In eight London boroughs, including Hackney and Tower Hamlets, families would need to earn more than £60,000 a year.

The rate of inflation on private rents in London was seven per cent in 2011, almost double the rate of inflation on the average London wage, indicating that family budgets are set to be squeezed even further as rent rises consistently outstrip inflation.

With the typical London household income less than £35,000, Shelter is warning that growing numbers of families are at crisis point, paying up to half of their income in rent each month as they struggle to continue living and working in the capital.

Shelter’s Homes for London campaign is demanding the next Mayor uses their influence to make housing a top priority, and stand up for London’s renters by brokering a better deal for them which protects families from the capital’s out-of-control rental market.

Shelter’s Chief Executive Campbell Robb said: ‘These findings paint a worrying picture of thousands of families across the capital being stretched to the limit by the high cost of renting, praying they won’t be hit by another rent rise that could tip them over the edge.

‘With so many Londoners locked out of home ownership, more and more families have no other option but to rent. But rents are now so out of touch with wages that some families are spending over half of their income just to keep a roof over their head, leaving little left for food, fuel and other essentials. 

‘London’s renters will be looking to the next Mayor to fix London’s out-of-control rental market, and give them some stability and predictability with their housing costs.

‘By joining our campaign Londoners can find out the real cost of renting where they live, and challenge the mayoral candidates about what they would do to address London’s growing housing crisis.’

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0 thoughts on “London rents unaffordable

  1. Keith Jordan says:

    Looking at this problem from a strategic and economic perspective it is clear that something will have to give.
    London will not be able to function without key-workers, and these include low paid cleaners, maintenance workers, waiting staff etc.
    The high prices we see are a product of supply and demand. The only way to alleviate the burden for those finding it difficult to live in London is to either increase supply or reduce demand. Given the size of the task required to increase supply, the logical approach would be to reduce demand.
    Reducing demand for London property is best achieved by finding ways to encourage large employers that do not *need* to be in London to relocate elsewhere. Many of them will cry that they do not have access to the skilled workforce. Yet half of that workforce commutes in from the commuter belt. Therefore, there is clearly the skilled workforce in the commuter towns. Logically, then, the first places firms should look to relocate out of London is the commuter belt.