Revealed: The most affordable regions to rent

The North East is the most affordable region to rent in the UK, according to new data.

Figures from Paragon Bank reveal that rental affordability ratio, which is average earnings divided by mean rent, found that the ratio in the North East was 23.5%.

Paragon’s Rental Affordability Index uses recently published government data on the average amount spent on rent as well as gross annual earnings figures.

Landlords often limit rent increases in order to keep good tenants

The affordability of privately rented homes in the North East has seen a small drop of 0.2%, as mean rents have grown slightly from £6,424 to £7,054.

The North East was followed by the Yorkshire and the Humber region at 25% and North West at 25.3%

Richard Rowntree, Paragon Bank managing director of mortgages, said: “As we saw when we analysed these figures last year, we see stark disparity between how affordable privately rented homes are in different parts of England, the north notably more economical than London and the South West.

He added: “We also see how rent payments still represent a sizable proportion of monthly outgoings, the most significant in many cases.

“While we know that landlords often limit rent increases in order to keep good tenants and many understand the financial challenge their renters may currently face, they themselves are up against rising costs so a degree of rental inflation is unfortunately inevitable.”

London least affordable region

The least affordable region is London with a ratio of 48.5%  followed by the South East at 35.9% and the East of England at 33.3%.

Average rents paid by tenants in London increased from £18,244 last year to £19,213. With earnings in the capital averaging £39,654 in 2022.

Mr Rowntree says the demand for affordable PRS homes has risen dramatically over the last few years.

“Fuelling this, demand for affordable private rented sector (PRS) homes has peaked over the past few years and remains well above supply.

“This is why it is vital that housing policy is developed in a way that promotes high standards while making investment in the PRS an attractive option for responsible lettings business owners.”

A full table on the most and least affordable regions in the UK can be seen below.

Share This Article