London's Generation Rent can't afford to start a family

Generation rent

Renting a home in the capital is so expensive that couples are spending 55% of their combined average monthly salary – that’s £2,460 – on renting the average three-bedroom house, new research has revealed.

The research by property crowdfunding platform Property Partner found that a couple would have to fork out £29,520 a year in rent before even budgeting for childcare and other costs.

 

The research compared how much it would cost as a percentage of salary for couples to step up from the average one- or two-bedroom flat into a three-bed house in all 33 London boroughs for couples with an average combined monthly income of £4,417.

The 10 least affordable boroughs were Kensington & Chelsea, Westminster, Camden,Tower Hamlets, Hammersmith & Fulham, Islington, Southwark, Hackney, Wandsworth and Lambeth. In the most expensive borough, Kensington & Chelsea, it would cost a whopping 168% – or  £7,4343 – of combined salary to rent a three-bedroom house.

Couples thinking of starting a family should head to Bexley, where it would cost 29.6% of their combined monthly – or £1,311- to rent a three-bedroom house. Other more affordable boroughs include Havering, Sutton, and Barking and Dagenham.

 

Dan Gandesha, chief executive of Property Partner, says: "Our research will come as a shock to tenants in the capital. With London house prices now so high, the ranks of Generation Rent are rapidly expanding. And, as demand for larger rental properties has grown, finding affordable accommodation is increasingly difficult.

“Those unable to buy but hoping to start a family and move up the rental ladder may just be able to make ends meet in outer London boroughs. But the harsh reality is that they’ll be forced to bring up their children in a flat rather than a house. Although everyone knows Kensington & Chelsea, and Westminster, are totally out of reach on an average London salary, the surprise comes with Camden and Islington too. Even in the cheapest borough, Bexley, a couple would have to fork out £15,732 a year of their joint net income to pay the rent on a three-bed property.

“Another sobering thought is that our research assumes both partners are in full time employment and earning the average London salary. The figures do not take into account that if a couple has one or two children, the costs of childcare and household bills would make meeting the monthly rent unachievable,” he adds.

Average rents for one-bed, two-bed and three-bed propertis compared with rent in all 33 London boroughs

Borough Average rent for 1 bed flat Rent as a % of salary for 1 bed flat Average rent for 2 bed flat Rent as a % of salary for 2 bed flat Average rent for 3 bed house Rent as a % of salary for 3 bed house
Bexley £753 17.05% £1,052 23.81% £1,311 29.68%
Havering £882 19.97% £1,132 25.63% £1,417 32.08%
Sutton £906 20.51% £1,203 27.23% £1,776 40.20%
Barking and Dagenham £951 21.53% £1,205 27.28% £1,484 33.59%
Bromley £885 20.03% £1,292 29.25% £1,569 35.52%
Croydon £981 22.21% £1,293 29.27% £1,598 36.17%
Redbridge £965 21.85% £1,320 29.88% £1,667 37.74%
Waltham Forest £1,063 24.06% £1,337 30.27% £1,795 40.63%
Enfield £973 22.03% £1,366 30.92% £1,763 39.91%
Hillingdon £948 21.46% £1,366 30.92% £1,601 36.24%
Harrow £1,028 23.27% £1,436 32.51% £1,761 39.86%
Lewisham £1,067 24.15% £1,490 33.73% £1,880 42.56%
Kingston upon Thames £1,127 25.51% £1,560 35.31% £1,901 43.03%
Barnet £1,167 26.42% £1,573 35.61% £2,084 47.18%
Greenwich £1,211 27.41% £1,593 36.06% £1,893 42.85%
Haringey £1,193 27.01% £1,614 36.54% £2,060 46.63%
Newham £1,239 28.05% £1,668 37.76% £1,973 44.66%
Brent £1,249 28.27% £1,685 38.14% £2,211 50.05%
Hounslow £1,204 27.26% £1,706 38.62% £2,036 46.09%
Merton £1,325 29.99% £1,790 40.52% £2,335 52.86%
Ealing £1,289 29.18% £1,812 41.02% £2,098 47.49%
Richmond upon Thames £1,470 33.28% £1,932 43.74% £2,592 58.68%
Lambeth £1,485 33.62% £2,099 47.52% £2,325 52.63%
Wandsworth £1,480 33.50% £2,152 48.72% £2,591 58.65%
Hackney £1,600 36.22% £2,167 49.06% £2,811 63.63%
Southwark £1,589 35.97% £2,194 49.67% £2,608 59.04%
Islington £1,738 39.34% £2,355 53.31% £3,461 78.35%
Hammersmith and Fulham £1,695 38.37% £2,389 54.08% £2,887 65.35%
Tower Hamlets £1,439 32.58% £2,399 54.31% £2,437 55.17%
Camden £1,814 41.06% £2,738 61.98% £5,383 121.86%
Westminster £2,602 58.90% £3,864 87.47% £5,978 135.33%
Kensington and Chelsea £2,634 59.63% £4,059 91.89% £7,434 168.29%
London average £1,311 29.68% £1,839 41.63% £2,460 55.69%

Source: Property Partner

Published: 30 November 2016
Last updated: 30 November 2016

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