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UK PRS Rents Highest In EuropePRS Rents Still Increasing

Rent paid by tenants in the UK’s private rental sector, (PRS), increased by 2.1% in the 12 months up to and including March 2015, according to the latest published figures released by the Office for National Statistics (ONS), drawing claims from the National Housing Federation (NHF), that the UK is the most expensive country to rent property in within the European union.

In the 12 months to March 2015 UK PRS rents increased by:

  • 2.1% in England
  • 2.1% in Scotland
  • 0.8% in Wales

UK PRS rents are the highest in Europe, taking up 40% of tenant income despite having the shortest length of secure tenancies. In comparison our European counterparts only pay an average of 28% of their income on rent.

The NHF analysed the ONS data and found that on average UK PRS rents of approximately £750 per month for properties were almost double the rental costs of dwellings in countries like Germany and Holland, where average earnings are similar. However, it is worse for tenants in shared UK properties, who typically spent around 55% of their income on rent.

Across Europe, 43% of tenants had moved property in the last five years while in the UK this figure was more like 77%.

When the figures are analysed more closely it works out that approximately 23 minutes of every hour worked by UK PRS tenants is spent on rent; elsewhere in Europe, it is more like only 17 minutes.

The NHF also showed that the UK has repeatedly failed to invest in its own housing stock when compared to European standards, between 1996 and 2011 only 3% of the national Gross Domestic Product (GDP) was invested in UK housing, compared to 6% in Germany and 5% in France.

Other findings from the analysis include the fact that 72% of tenants renting in the UK private rental sector are employed compared to 62% of residential owner-occupiers.

NHF chief executive David Orr commented on the findings, stating: “UK tenants get a raw deal in comparison to their continental counterparts. High rents are just one symptom of the UK’s housing crisis, as a nation, we are simply not building enough houses due to under investment and problems with the land market.”

UK Double Dip Recession Gets Worse

UK Double Dip Recession Gets Worse

The UK economy has slumped to its longest double-dip recession for more than 50 years after shock figures revealed by the Office for National Statistics (ONS) showed that the British economy shrank by a worse-than-expected 0.7% between April and June 2012.

Gross domestic product (GDP) fell, by much more than the 0.2% expected by forecasters, for the third quarter in a row.

The economy’s poor performance has been blamed on the extra bank holiday for the Queen’s Diamond Jubilee and the good old British weather, with the wettest April to June period ever according to the Met office.

The ONS’s estimate for the UK economy may yet be revised but it does suggest that the UK is in the midst of the longest double-dip recession since the Second World War.

The last double-dip recession was in the 1970s, when the economy was hampered by rising oil prices, a 3 day working week and miner’s strikes.

The grim economic forecast puts further pressure on the UK coalition Government, who will face even more criticism about the austerity measures that appear to be choking any chance of economic recovery.

The UK economy is currently 0.3% smaller than when the coalition came to power in the second quarter of 2010.

Chancellor of the Exchequer, George Osborne said: “We all know the country has deep-rooted economic problems and these disappointing figures confirm that. We’re dealing with our debts at home and the debt crisis abroad. We’ve made progress over the last two years in cutting the deficit by 25% and businesses have created over 800,000 new jobs. But given what’s happening in the world we need a relentless focus on the economy and recent announcements on infrastructure and lending show that’s exactly what we’re doing.”

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