Tenants in London now pay more than double those elsewhere in the country, research has revealed.
A report by insurance provider HomeLet found that the average monthly rent payment in the capital was £2,109 in July, compared with £1,037 elsewhere in the UK.
Westminster remained the most expensive district, with a typical home priced at £3,360 per month, more than three times the UK figure.
Across the capital, tenants handed an average of 38 per cent of their gross household income to landlords in July this year, up from 31 per cent six years earlier.
Five cheapest London areas
Borough(s) |
Average rent in July 2023 |
Croydon |
£1,471 |
Redbridge and Waltham Forest |
£1,590 |
Barking, Dagenham and Havering |
£1,679 |
Bexley and Greenwich |
£1,726 |
Harrow and Hillingdon |
£1,748 |
Source: HomeLet
In an increasingly unaffordable city, Croydon was the cheapest area to rent in in July, with a typical property costing £1,471 a month.
Richard Marsh, owner at local estate agency Folklands, says that at least half the people he sees looking for homes in the south London borough are moving from more central locations.
"We have a steady flow of tenants from the likes of Streatham, Brixton, Clapham and Dulwich," he says. "If only I had £5 for every time someone said to me that their landlord was either selling up or raising their rent by hundreds of pounds.
"They come to Croydon and get the same quality and space for a lower price along with sensational transport links."
Marsh says the long-awaited Westfield-led redevelopment of Croydon town centre will boost an inevitable gentrification of the area as more people flock to it from further north.
A wave of build-to-let development including the 546-home, 44-storey Ten Degrees tower highlights investor interest in the area, he adds. "We see a number of young professional couples looking to set up their first home together, perhaps moving out of shared houses in the SW and SE postcodes.”
Redbridge and Waltham Forest was the next cheapest area of the capital to rent in July, at an average of £1,590 per month. Over the course of a year, this slice of east London works out as £1,428 more expensive than Croydon.
Meanwhile a west London corridor encompassing Hounslow and Richmond upon Thames saw the slowest growth in prices over the past year. Typical rent in this area was up just 7.6 per cent to £1,920.
Across London, however, the proportion of household income required to pay rent — worked out by HomeLet on an individual tenancy basis — is at its highest since this data began to be collected nine years ago. By contrast under a quarter of income is generally required to pay tenancy bills in the North East of England.
Marcus Dixon, director of UK residential research at property specialists JLL, warns Londoners are only likely to need more of their income for housing in the near future.
“Annual rental growth has outpaced earnings growth every month since June 2021,” he says. “This means tenants are having to spend a higher proportion of their income on rent. This is a trend which could continue for some time yet.”
