UK Relocation: Renting in London vs. the Rest of the UK
Our Cartus UK MarketWatch focuses on the current trends in the UK sales and rental markets—critical information for those involved in UK relocation. The latest issue looks at the price difference between renting in London and the rest of the country, as well as the supply/demand imbalance.
Price Gap Between London and the UK
A significant difference remains between London rentals and the rest of the UK, with experts indicating that the price gap continued to widen throughout 2015. Those renting a property in the UK (excluding London) may expect to pay a monthly average of £739. In London, the average monthly figure is estimated to be £1,523 – that’s 106% higher than the rest of the UK. (HomeLet)
The variance in monthly rental values may be attributed to the overpopulated London rental market, with competition amongst tenants pushing up rental prices. Of course, a high number of prospective tenants move to London every year, which increases the overcrowded market, but another key contributor is a lack of affordable housing in the sales market. Many prospective buyers – so called ‘trapped tenants’ – are having to stay in rental accommodation, because they’re unable to afford the large mortgage deposit needed to secure a property.
The UK government recently proposed a programme of changes to help combat the challenge of a lack of affordable housing. This includes a London Help to Buy scheme, to help people get onto the property ladder. As tenants use the scheme to purchase a home, it may ease the overcrowded London rental market over time. Still in a consultation phase, the final policy design is expected to be outlined at the next UK government Budget announcement on 16 March 2016.