PRS 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.”
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