Private rents in England hit record high during coronavirus lockdown

Phillimore Gardens, Kensington, London, W8;

Powered by article titled “Private rents in England hit record high during coronavirus lockdown” was written by Patrick Collinson, for on Wednesday 17th June 2020 13.33 UTC

Private-sector rents in England hit a record high of £700 a month just as the country was heading into coronavirus lockdown, according to figures from the Office for National Statistics (ONS).

The median rent was highest in London, at £1,425 a month, and lowest in north-east England, at £495.

The most expensive location to rent was Westminster, where the median was £2,492 a month, or five times the average rent in England’s cheapest location, Hull, where tenants typically pay £420 a month.

The data covers the period between 1 April 2019 and 31 March 2020, with the ONS observing that “it has not been higher”.

Record-high rents will fuel concerns about affordability, and the growing part of a renter’s total income that is passed to landlords. Earlier research has shown that renters on average spend 41% of their income on housing costs.

In total about 8.5 million people rent privately in England, with many reporting unaffordable rents, poor living conditions and the risk of eviction.

When the Covid-19 pandemic struck, mortgage holders and landlords with buy-to-let portfolios were offered payment holidays, but tenants had to rely on these being passed on.

However, last week the government extended its ban on evictions in England and Wales by a further two months, prolonging the grace period for thousands of tenants who have struggled to pay the rent during lockdown.

Caitlin Wilkinson, the policy manager at the campaign group Generation Rent, said: “At the outset of this crisis, renters were spending more on housing costs than at any time previously. In light of these figures, it’s not surprising that many private renters who have since lost income are struggling to make ends meet.

“While we don’t yet know the impact of the pandemic on rents, we do know that more than half of tenants who have requested a rent reduction have been asked to pay in full. These figures highlight the need for the government to provide rent relief to those struggling with sky-high rents as part of the UK’s coronavirus recovery strategy.”

Few housing experts predict that rents will fall by much, even if the pandemic prompts a slump in house prices.

Researchers at Savills UK this week revised their house price forecast for 2020, and now expect a 7.5% fall in 2020, down from a previous forecast of -5%. But they predicted rents would fall by just 1.5% this year before rising by 5.5% next year.

Savills said: “Rental values tend to be more resilient than capital values during a downturn. Rents fell just 2% following the financial crisis, whereas house prices fell -18%. We expect rents will also remain relatively resilient in the coming months and years, albeit there may be greater pressure in areas more reliant on international tenants and students.” © Guardian News & Media Limited 2010

Published via the Guardian News Feed plugin for WordPress.