Generation Rent blames landlords for soaring rent prices outpacing wages

Generation Rent claims “landlords are snatching away more of renters wages” as rent prices continue to outpace wages.

According to the Office of National Statistics (ONS) Rental Price Index, private rents rose by 8.4% in the year to August 2024, outpacing the 5.1% increase in wage growth.

Over the same period, rents in England increased to £1,327, up by 8.5%; in Wales to £752, also up by 8.5%; and in Scotland to £969, marking a 7.6% rise.

Rents continuing to rise

In England, rents inflation was highest in London (9.6%) and lowest in the South West (6.4%), in the 12 months to August 2024.

According to the ONS, the average rent was highest in London (£2,129) and lowest in the North East (£682).

Ben Twomey, chief executive of Generation Rent, says rents are continuing to rise.

He said: “Prices in the shops may have stopped rising so quickly, but renters are still seeing our single biggest cost go up faster than our incomes. This isn’t news to renters, who have been feeling this squeeze for a very long time as our landlords snatch away more and more of our wages.

“The government’s Renters’ Rights Bill, published last week, offers many positives for tenants, but the cost of renting crisis will rage on unless Westminster slams the brakes on these runaway rents.

“This Bill must contain protection from these unaffordable rent rises, which should mean preventing rent rises going above wage growth or inflation – whichever is lower. Alongside this, we desperately need more homes people can afford to live in, in the places people want to live, and we are pleased that the government have set out this long-term aim.”

Housing market continues to improve

The ONS also reveals house prices rose by 2.2% to £290,000 in the 12 months to July 2024.

According to the ONS house price index, this growth, though down from 2.7% in June 2024, marks the fifth consecutive month of annual price increases following a period of decline.

In July 2024, the average house price in England was £306,000, a 1.6% increase from the previous year. In Wales, the average house price rose to £218,000, up 2.0% while in Scotland, it reached £199,000, a 6.0% increase from the previous year.

Nathan Emerson CEO at Propertymark says the housing market continues to improve.

He said: “It is reassuring to see further progress within the housing market as we continue to witness a consistent trend of growth as the year plays out. Overall, 2024 has proven to be transformative for the housing market with it facing a myriad of challenges at the start of the year and gathering pace to a far more upbeat performance as demonstrated by these latest figures.

“Propertymark remains keen to see the UK government kick start their house building programme to alleviate current pressures on housing demand and there is also a massive interest from those who aspire to buy to see and understand what support may be offered to boost their ability to get a footing on the housing ladder.”