London renters are getting poorer and moving further out
Thanks to the increase in average rents and decrease in average income, Greater London renters have an average of £254 less every month than they did in May 2012. The figures come as housing charity Shelter is highlighting that what it calls out of control letting fees are forcing more people into debt.
The HomeLet figures show the average cost of renting a home in the capital increased by 3.1% over the past year to £1,233 per month. In contrast, the average amount a tenant earns in Greater London decreased by 6.8% to £36,000 a year. HomeLet say this means tenants in London are now paying rents that are 8.7% higher than two years ago, but earning 3.5% less.
Elsewhere in the UK, the cost of renting a home increased by 2.5% from May 2012 to £787 per month – without the London figures, the average cost of renting a home in the UK is £668 per month. Renting a home in the capital is now 84% more expensive than the rest of the UK.
Meanwhile, Cluttons reports that tenants are looking to move to the peripheries of prime Central London, mainly zones 2 and 3, in search of lower budget properties as they try to reduce outgoings. Average weekly rents are £1,016 in prime Central London. They say popular areas to the east include the Isle of Dogs, Limehouse and Wapping which have seen an increase in tenant demand of 42% between the last three months of last year and the first three of 2013.
Earlier in the week, figures from Savills showed that by selling the average London family home, it was then possible to buy a replacement one in a convenient commuting area outside London and also have money left over to invest in a buy-to-let flat in a decent rental area.
Do greener homes sell for more?
Making energy saving improvements to your property could increase its value by 14 per cent on average and up to 38 per cent in some parts of England, according to the Department of Energy and Climate Change (DECC).
For an average home in the country, improving its EPC (Energy Performance Certificate) from band G to E, or from band D to B, could mean adding more than £16,000 to the sale price of the property. In the North East, improved energy efficiency from band G to E could increase this value by over £25,000 and the average home in the North West could see £23,000 added to its value.
Kevin McCloud, broadcaster and co-founder of the Grand Designs Future Living home retrofit company, said: “There are some 26 million homes in Britain, most of them about as well insulated as a rabbit hutch, and they need immediate help to be made less wasteful. This timely report tells us what we suspected all along, that people really value the well-insulated, energy-efficient home; that modest investment in measures to make our homes more comfortable, healthier and cheaper-to-run really pays off.”
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