Graduates in London spend half of salary on rent
Two graduates sharing a two-bed property with average rent of £1,917 would spend a whopping 49% of their income on rent, according to research from Landbay.
The specialist buy-to-let mortgage lender’s rental index revealed that even three friends sharing a three-bed property would spend a massive 45% of their monthly take-home pay on rent of £2,683.
Those attempting to live alone face spending almost three quarters (75%) of monthly take-home pay on rent of £1,445.
Better off in Bexley
Of the London boroughs, the most affordable average residential rents are found in Bexley (£1,004), Sutton (£1,506), Havering (£1,072), Croydon (£1,125) and Bromley (£1,169). Bexley has seen the strongest rental growth of all the boroughs with a 1.98% rise in average rents over the last year.
The index also found that in the most expensive boroughs – Kensington & Chelsea (average rents of £3,042), Westminster (£2,891), Camden (£2,219), City of London (£2,074) and Hammersmith & Fulham (£1,886) – rents have fallen over the last year by -2.36%, -2.38%, -1.13%, -2.35% and -1.67% respectively.
John Goodall, chief executive officer and founder of Landbay, said: “Faced with record high student debt levels and the rising cost of living, it will be little surprise to see graduates starting to look elsewhere from the traditional young professional hot spots such as Fulham and Camden when they come to London. Surrounding areas are clearly worth the longer commute to reduce the rent burden and give them any hope of saving for a deposit on a house of their own one day.
“There are of course a number of factors at play, but as returns fall in the more central locations, landlords may look to the outer boroughs to seek more attractive yields.”