If you had to name the place in the UK where it was most expensive to rent a property and where you would earn the highest monthly salary, London would be a pretty good guess.
But how about the city in the UK where you would end up with the highest monthly income after rent has been paid, would it still be London or somewhere else?
New research has shown that tenants living in London spend the highest percentage of their salaries on rent – an average of 37.08 each month.
This is the highest across 17 of the UK’s major cities while the smallest amount, of 11.64 per cent, is paid by renters in Hull.
Londoners fork out 37.08 per cent of their monthly average wages on rental costs
These high living costs mean those living in the capital have less money available, after rental costs, than renters living in 16 other UK cities.
Renters in London pay an average of £836.05 each per month for rent, based on two people living in a two-bed property, according to data from RightMove.
The average monthly take home salary is £2,254.94, according to data from website CV-Library, bringing the percentage spent on rent up to 37.08 per cent.
The salary figures were taken from a list of 626,523 job adverts listed on the website between January and October last year.
Those in Brighton, in second place, pay 32.68 per cent, followed by 23.32 per cent in Edinburgh and 21.92 per cent in Bristol.
At the other end of the scale, renters in Hull pay the smallest monthly amount of rent, an average of £227.68, compared to their average salaries of £1,956.65.
Tenants in Liverpool, Sheffield and Newcastle are in a similar situation paying out 14.60 per cent, 14.99 per cent and 15.46 per cent respectively.
|Rank||City||Average rent||Average earnings||Percentage of wage spent on rent|
|Source: Rightmove data of average asking rental prices for a two-bed property in key cities across the UK, based on two people living in the property splitting the cost. CV-library data of average take home salaries advertised in 17 UK cities from 1st January – 31st October 2017.|
Out of these 17 cities, those living in Aberdeen earn the highest monthly wages when looking at jobs listed on the site at an average of £2.301.40, with London in second place.
While it’s not hugely surprising that rental costs and earnings in London are so high, when looking at average earnings after rent, it is mainly cities located outside of the South of England that feature.
Renters in Aberdeen are left with the highest sums, at an average of £1,983.76 followed by those in Hull, with £1,728.97 and Glasgow with £1.650.57.
The only southern city to feature in the top 10 list for salaries after rent is Bristol, where renters are left with £1,632.58.
High costs: Renters in London pay the highest average percentage of their salaries in rent (Clockwise from top left: London, Brighton, Edinburgh, Bristol)
There are lots of other factors which also need to be taken into account when looking at the average incomes, such as household bills, childcare costs, transport prices and availability of jobs but today’s research is interesting when looking at how renters fare across the country.
Lee Biggins, founder and managing director of CV-Library, comments on the findings: ‘Despite the government’s efforts to eliminate the North/South divide, it’s clear that living costs and wages aren’t quite following suit.
‘Generation ‘rent’ is well and truly in full swing, and while some cities offer manageable living costs and generous pay packets, others could be pushing workers to breaking point.
‘What’s more, these findings do not factor in additional costs on top of rent, such as council tax, electricity, water and gas bills, not to mention other monthly outgoings including mobile phone and internet contracts, pension, transport, insurance and so on.
Renters in London have the highest average rental costs out of 17 major UK cities
‘This means that those living in cities such as London, Brighton, Edinburgh and Bristol could be heading towards debt levels each month.’
Today’s research follows on from news earlier in the week from the National Landlords Association that one in five landlords plan to reduce their property portfolios this year, fuelling fears of rising rental prices.
This comes as a raft of recent government changes including the withdrawal of mortgage interest relief for higher and additional rate tax payers, a three per cent surcharge on purchases of additional properties and a banning of upfront fees for tenants to curb buy-to-let in the private rented sector begin to bite.
Richard Lambert, chief executive of the NLA, said: ‘More and more people are relying on this sector for a home, so it is vital that landlords not only provide a high standard of accommodation, but are incentivised to do so by the prospects of a reasonable return on investment.
‘It is our view that these policies are undermining the viability of many landlords’ businesses and removing the incentives to invest in residential property for business purposes.’
Do you live in one of the cities mentioned? And do you agree with the findings? If so let us know in the comments box below.
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