The reality of rip off rents in London

By Molly Gretton

When my partner and I decided to move in together this year, we could not have anticipated the sudden rocketing rental prices and intense competition. We have both been renting in London for five years now and in the past finding a new rental has been tedious but not a complete nightmare.

According to Rightmove, rental enquiries in London have increased by 23% in comparison to last year, driven in part by some would-be buyers putting their plans on hold in the hope that mortgage rates will drop in the new year. Alongside this, data from Foxtons has revealed that London rents in the first nine months of the year have risen by 22% since 2021.

Due to such high demand, we, along with every other London renter, now face an awkward bidding war with other potential tenants forcing us to make the decision to pay over the asking price to secure the property.

The cause of this crisis is decades in the making. Too few houses have been built and demand is ever rising.  There is simply not enough affordable housing to go round. According to a report published last year by London Councils, approximately 43,000 homes will be completed in London each year between 2021 and 2025. However, the city actually needs 90,00 to 100,000 new homes per year, with the report suggesting that only half will be affordable and aimed at buyers and renters currently priced out of the market.

Some may argue that this shortage has been enabled and encouraged by Britain’s army of NIMBY’s (“not in my back yard”); those who say how much they agree with more housing…. If it isn’t where they live.

Alongside this drastic shortage in availability, the average London tenant can expect to spend approximately 40% of their income on renting a property and the latest figures show that expected rents for new rentals in London are growing faster than anywhere else in the UK, up more than 16% in the last year.  

So, what is being done to combat this? On 14^th November, the Mayor of London, Sadiq Khan, brought together private renters, charities, advocacy groups and politicians to call on the Government to urgently tackle London’s spiralling rental crisis. He revealed that rents increased by over 20% in inner London in the first half of 2022 compared to a growth of about 2% in the first half of 2019. This rapid increase is unsustainable, which is why he called on the government to urgently introduce a two-year rent freeze, to ease the burden on renters as the cost-of-living crisis worsens. 

For now, we can only hope that following the turbulent housing market partly caused by Liz Truss’ governments mini budget, the cost and availability to mortgages will start to settle, meaning less saturation of the rental market and subsequently a decrease in rental prices and competition.

While we have no option but to continue the hunt for a place to rent in London, the UK Government needs to unite to address the housing crisis and stop an exodus of renters forced into the suburbs. But we may have to wait a while longer yet following the announcement from Michael Gove, Secretary of State for Levelling Up, Housing and Communities, on Monday evening that the government would be softening housing targets.