Renters are Quitting London According to Countrywide
This week marks a milestone for the London property market as the number of private renters leaving the capital has reached a five year high. These findings mirror sentiments regarding inflation voiced by critics and politicians alike, however as the average salary in London remains the same, housing prices continue to soar due to the largely unregulated market.
What's the Story?
Recent studies indicate that rental prices in the capital have increased by a third over the last decade, while renting a property in London may cost residents as much as 66% of their earnings.
When compared to average rent hikes of 13% in the West Midlands and 11% in the North-West of England, it’s hardly surprising that so many Londoners are choosing to migrate in search of cheaper accommodation.
The research carried out by property firm Countrywide found that as opposed to last decade when most tenants were moving to buy there own property, now the overwhelming majority are willing to go to further lengths in search of affordable rent. This is probably why of the 50,406 renters moving out of London, more were prepared to move twice the distance heading to locations in the North and the Midlands.
Additionally, data collected by the Institute of Fiscal Studies indicates that this seismic shift in rental trends will most significantly affect middle-income workers and young families who largely account for the 22% of private renters leaving London in search of a cheaper home to buy. This is in part down to cost efficiency but also due to the quality of accommodation, as the ratio of floor space to residents has shrunk by 10% in London over the past ten years as a result of shared housing becoming more common.
This comes as a a stark contrast to the twenty-something demographic who show the only positive net migration to the city, typically moving in order to study or start their careers.
Where are they going?
Countrywide’s research director referred to leaving London as a ‘rite of passage’ for those in the 30+ demographic which is most likely why they are deserting the capital at the highest rate, moving to smaller towns and cities such as St Albans, Dartford and Cambridge where buying a home costs 16% less on average than respective accommodation in the capital.
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