With the average monthly rent for Londoners living in the private sector hitting more than £2,000 during the autumn, campaign group Generation Rent has called on the government to bring in a rent freeze to fight the growing cost of living crisis.
Rental crisis: with rents rising at 12%, landlords have a powerful position over their tenants
Figures from Hometrack’s latest survey of the private rented sector show that tenants across the country are now spending more than one-third of their income on their housing costs.
Hometrack predict rental inflation at 4 to 5per cent in 2023.
But in London, the survey of estate agencies found that average rents charged by private landlords went up by 16per cent. Some larger estate agents working for landlords in the capital have been accused of “gouging”, profiteering with even bigger rent rises, with London rents on average increasing by £3,378 in 2022 – reckoned to be a 20.5per cent rent rise, twice the rate of inflation.
Generation Rent says that half of private renters have been handed an increase in rent in 2022, most being asked for more than £50 extra per month. “Since the summer, paying rent has overtaken paying utility bills as the biggest concern of private renters,” said Generation Rent.
“After the government acted to cap social rent increases and improve the terms of Support for Mortgage Interest, private renters remain vulnerable to unaffordable rent increases that could force them out of their homes,” the campaign group says.
As well as calling on the government to freeze rents, Generation Rent wants the Conservative government to suspend no-fault evictions and to link Local Housing Allowance to market rents.
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Anxiety about paying rent has increased. In a survey of more than a thousand private tenants last month, 41per cent said their biggest concern in relation to the cost of living was paying the rent. In a similar survey conducted in July, only 26per cent expressed the same concern.
The survey found 1-in-5 private renters now report that they have cut back on spending in order to pay rent.
Generation Rent asked respondents what reason they were given for their rent increase. The most common answer was “higher market rents” (40%), followed by “cost of living” (19%) and “letting agent advice” (17%). Despite recent interest rate increases, just 11% of respondents said their landlord had blamed “higher mortgage payments”.
Policy changes: Generation Rent’s proposals would do much to take the heat out of the private rental market
According to Zoopla, rents on new tenancies have increased by 12per cent in the past year.
Alicia Kennedy, director of Generation Rent, said, “Despite the support package around utility bills, private renters are becoming increasingly anxious about paying their rent. While it is possible to negotiate, renters know in the current climate landlords have them over a barrel. Landlords can ask their tenants to pay the going market rent or use a no-fault eviction to force them into the ultra-competitive lettings market.
“Without emergency government support, renters will face dilemmas which will result in ill-health, as a result of the stress of finding a new home, eating less or turning the heating down.”
- Read Generation Rent’s Dec 2022 survey report in full by clicking here
- Read Hometrack’s Dec 2022 report on the private rental market
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I wonder how many of the landlords passed on the change in mortgage costs when interest rates fell to historic lows in previous years.
Around about the same proportion of oil companies that have passed on the dramatic fall in energy prices…