Price of renting in London soaring, survey finds

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24th June 2015 11:34 - Housing

A recent survey on behalf of HomeLet has discovered that the cost of renting a property in London is soaring, with the average rented home Price of renting in London soaring, survey findsreaching £1,500 per month.

The HomeLet survey revealed that rent has increased by 12.5 per cent throughout the UK, with the average tenant paying £751 per month for a home outside of London.

According to the survey, rental costs have increased five times faster than tenant income over the past three months.

The increase will put pressure on workers who will become unable to save up for the large deposit which banks demand before being approved for a mortgage, due to their disposable income being spent on rent.

Out of all the regions in the UK, just the North West, East Anglia and Yorkshire and Humber have experienced a fall in the cost of renting.

The increase in the cost of renting can be attributed to the housing crisis in the UK, which is increasing the cost of purchasing a first home and in turn, making it difficult for first-time buyers to get on to the property ladder. As a result of the shortage of houses, there is now a demand for rental homes.

Money Advice Trust said that the increasing prices are a cause for concern.

“The proportion of calls we were getting on rental arrears in 2010 was 6.6%. This year so far it’s 11.4%, so that’s a doubling,”said a spokeswoman for the Money Advice Trust. “It’s both in the public and private sector.”

The survey examined 13,000 tenant reference applications in May 2015. Of the tenant reference applications, 3,000 were in London.

In the last 12 months, the increase has been 5 times bigger than that of 2 years ago, when the year-on-year increase was just 2.6%.

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