Revealed: The most affordable regions to rent

Revealed: The most affordable regions to rent

0:01 AM, 14th June 2023, About 9 months ago 3

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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.

Region 2022 income

£

Mean rental

£

Affordability ratio %
North East 30,078 7,054 23.5
Yorkshire & The Humber 30,271 7,582 25.0
North West 30,850 7,808 25.3
East Midlands 31,084 8,222 26.5
West Midlands 32,065 8,522 26.6
South West 31,709 10,104 31.9
East of England 34,713 11,552 33.3
South East 35,507 12,739 35.9
London 39,654 19,213 48.5

 


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Comments

Neil P

10:03 AM, 14th June 2023, About 9 months ago

An interesting stat to complete the table above would be what money is left for everything else after rent:

North East 23,024
Yorkshire & The Humber 22,689
North West 23,042
East Midlands 22,862
West Midlands 23,543
South West 21,605
East of England 23,161
South East 22,768
London 20,441

So very similar figures. It's not rocket science that the cheaper rental areas are where the incomes are lower - it's what's affordable!

david

10:30 AM, 14th June 2023, About 9 months ago

It would be nice if some banks like Paragon try to do the same thing:

Limit the rate increase in order to keep the good borrowers!
By providing a reasonable products transfers..!

Keith Edwards

10:44 AM, 17th June 2023, About 9 months ago

This appears to be for England,only, where’s the rest of the UK ?

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