Average rent outside London now hits £750 per month

The average rent paid for a home in the UK outside London hit £750 in December, rising by 2.04 per cent on average over 2016.

The latest data from lender Landbay shows rent now accounts for some 53 per cent of the average take-home pay for people living outside the capital.

Average rents across all property sizes grew by 2.13 per cent in England - excluding London - and grew 1.42 per cent in Scotland and 1.43 per cent in Wales over the past year, rising to £755, £721 and £634 respectively by the end of December. 

Together, this means the average monthly rent paid for a property in the UK outside London has hit £750, claims the lender.

Meanwhile, wage growth has failed to keep pace. 

Disposable income - the take-home pay individuals receive after tax and benefits - fell across the UK by 2.3 per cent in the first three quarters of 2016. Outside London (where average income is significantly lower than in the capital) disposable incomes are approximately £1,425 per month. 

Landbay says this means that for an average-sized household with a sole earner, over half of their disposable income is spent on rent. If that individual lives in a one bedroom property, where rents are a more modest £592 per month, the proportion spent on rent falls to 42 per cent of take-home pay.

Those living in the capital face an even narrower margin. 

Average rents in London remain more than double the average for the rest of the country at £1,882, despite dipping by 0.13 per cent in December, with average disposable incomes at £1,967. 

For single-earner households, that means that the average monthly rent for a one-bed is 74 per cent of take-home pay. 

Accordingly most London households must rely on multiple or high income earners. 

“The government may have just committed £7 billion to building an additional 200,000 affordable starter homes, but supply across all tenures is still too low. The buy to let market has become a ‘catch all’ for a forgotten generation of house hunters, for those who cannot, or choose not to, buy a property outright” claims a Landbay spokesman.