London’s commuter belt pushes further east as young people face “affordability crisis”

Young people in London are facing a growing affordability crisis, new research has shown, with the commuter belt expanding to the east.

Findings from the study show many Londoners are moving further afield to reduce their rent burden, possibly while they save for a house of their own.

Less affordable areas in London’s commuter belt, those with higher average rents and particularly those in the South East, have seen less demand and therefore slower rental growth.

Conversely eight out of ten counties in the East of England have seen rents rise by more than two per cent over the past 12 months, highlighting growing demand.

TFL recently revealed that Southern Rail trains are now the most overcrowded in the country, with some services carrying more than twice the passengers they were designed for, while figures this week suggested that more young people than ever, especially in London, are frustrated by the struggle to save, and now feel they will never find their way onto the property ladder.

Elsewhere, already expensive areas surrounding the capital have seen far less rental growth. For someone in Windsor or Maidenhead, traditionally deemed as ‘desirable’ regions for commuters, rents have seen the biggest slowdown.

Annual UK rental growth slowed to 0.64 per cent in July 2017, less than half of the rate of 1.86 per cent seen at the end of July 2016.

Outside of London, the pace slowed to 1.56 per cent, with average rents reaching £756. Within the capital, especially central London, the rents have now been falling for over a year, by -1.05 per cent over the past 12 months.

John Goodall, CEO and founder of Landbay said: “Young people working in London are wrestling with rising inflation on the one hand, and rock-bottom interest rates on the other, so it’s hardly a surprise that people are tackling longer commutes to reduce their rent burden while they save for a deposit on a house of their own.

“Naturally these surrounding areas are starting to experience a surge in rental prices, creating a ripple effect out from the capital. There are of course a number of factors at play, but it’s telling that already expensive areas surrounding the capital have seen far less rental growth, than much more affordable ones.”

Rental Index by county in the East and South East

Region County YoY % Av. £
East England Bedfordshire 3.19% 781
East England Cambridgeshire 2.17% 933
East England Essex 2.68% 953
East England Hertfordshire 1.31% 1,144
East England Luton 4.23% 789
East England Norfolk 2.34% 699
East England Peterborough 3.75% 629
East England Southend on Sea 1.78% 746
East England Suffolk 2.20% 721
East England Thurrock 3.56% 860
South East Bracknell Forest -0.15% 942
South East Brighton and Hove 1.29% 1,073
South East Buckinghamshire 1.15% 1,177
South East East Sussex 1.92% 775
South East Hampshire 1.72% 946
South East Isle of Wight 1.39% 569
South East Kent 2.28% 913
South East Medway 3.16% 806
South East Milton Keynes 1.48% 933
South East Oxfordshire 1.21% 1,193
South East Portsmouth 1.92% 864
South East Reading 0.11% 1,014
South East Slough 0.61% 964
South East Southampton 0.79% 759
South East Surrey -0.13% 1,439
South East West Berkshire 1.22% 895
South East West Sussex 2.03% 939
South East Windsor and Maidenhead -0.23% 1,270
South East Wokingham 0.14% 1,042

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