Renting a home in London costs nearly double the price of renting a similar property anywhere else in Britain, according to a new survey.
Rents in the capital have hit a record 87.8% more than anywhere else in the country – and are still rising, says the latest rental index from landlord insurance specialists Homelet.
The September figures show rents have increased 6.3% in the past 12 months, with the average London renter paying £1,273 per month – another record figure.
In contrast, rents outside London rose just 1.4% in September to £697 a month.
Landlords across Britain are
Reaping a record average £808 a month rent on the back of the performance of the buy to let market in London.
Homelet managing director Ian Fraser explained one of the reasons for the rent increase is explained by students moving in to shared homes for the start of the academic year.
“We generally see a dip in average rents at this time of the year. We’ve found the main reason for this is average rents are inflated over the summer months as more students secure their homes in time for the next academic year. By autumn this activity begins to decline and rents start to dip,” he said.
“As student properties tend to house a high number of tenants, their combined payments are typically higher than family homes. So as students now settle into their new homes, we may see rents decrease as we reach the end of 2012, and then rise once again in early 2013 when activity in the rental market begins to pick up once again.”
Fraser also suggests wealthy foreign renters and City workers buying property and a lack of mortgages are squeezing families out of the market.
“As a result these middle class families are left with no option but to rent, which leads to increased demand and prices within the private rented sector, particularly in the capital,” he said. “With the average tenant in Greater London earning an average 2.6% less than they did in September 2010, this is an issue that certainly needs addressing, as these families could also be priced out of the rental market too.”