London in ‘cost of renting crisis” as rents rise at shocking rate

The monthly HomeLet Rental Index has revealed London rents have increased by +3.1 per cent in just one month.
Rental prices in the UK have also risen by another +1.6 per cent this month, the fourth consecutive monthly increase.
This puts the UK in a “cost of renting crisis,” says HomeLet and Let Alliance CEO Andy Halstead.

Troubling figures have emerged from this month’s HomeLet Rental Index, which indicates London rents have risen by 3.1 per cent in one month alone.

Experts have warned that these trends are symptomatic of the UK’s rental crisis, which shows no sign of abating.

UK renters can now expect to pay 39.1 per cent of their wages in rent, with rent increasing by 7.9 per cent across the country in the last year alone – up 35.8 per cent on pre-pandemic rates.

Andy Halstead, CEO of HomeLet and Let Alliance believes this could be a sign of worse things to come for the housing market in London.

He says: “A trajectory like this could see rental prices increase by almost 20 per cent over the next 12 months, which would be the equivalent of over £65 per month more being paid out each month by the average Londoner.

“This puts the country in a clear ‘cost of renting crisis’ and the Government must act to provide landlords and tenants with the clarity they so desperately need.”

The news comes after the Renters (Reform) Bill recently passed a long-awaited third reading in the House of Commons before moving on to the House of Lords for consideration.

With landlords and tenants eager for clarity over the Bill’s key pledge to scrap so-called “no fault” evictions (Section 21 notices), its slow progress through Parliament only serves to prolong the current chaos within the private rented sector, according to Mr Halstead.

“Over the course of the last five years, since the scrapping of Section 21 notices was first mooted by the Government, the private rented sector has become increasingly more chaotic”, Halstead said.

“While this is just one issue among many that fuels the chaos, ministers need to understand that uncertainty and delays to important legislation like the Renters (Reform) Bill create uncertainty. That leads to landlord churn and market volatility.

“This has reduced the available rental stock and driven up rents as more renters compete for fewer rental properties. Until a clear date for the abolition of Section 21 notices is confirmed, many more landlords are likely to lose patience and sell up altogether. This will only inflate rental prices further – a situation the country can scarcely afford.”

Jack Peat

Jack is a business and economics journalist and the founder of The London Economic (TLE). He has contributed articles to VICE, Huffington Post and Independent and is a published author. Jack read History at the University of Wales, Bangor and has a Masters in Journalism from the University of Newcastle-upon-Tyne.