Rising rents drive higher earners into flatshares – SpareRoom

Wage gaps in flatshares intensify as rising rents force higher earners to house share, according to new data.

Figures from SpareRoom reveal that one in five (20%) UK flatmates estimate that the pay gap between the highest- and lowest-earning person in their household is more than £20,000, while almost one in 10 (9%) believe the gap exceeds £30,000.

The news comes as rents across the UK have risen by almost 7% in the past three years.

Much less viable to rent on a lower salary

Matt Hutchinson, director of flatshare site SpareRoom, said rising rents are reshaping who lives in shared homes

He said: “It used to be the case that a good salary would get you onto the housing ladder, or else renting alone or with a partner. But the cost of renting and living is now so high, sharing makes sense for people on higher incomes too.

“Sadly, it’s become much less viable to rent on a lower salary. We know from our analysis of SpareRoom users by age that younger adults, who generally earn less, are being priced out of the rental market altogether.

“While those earning more than £50K could likely afford to rent solo, it may mean compromising on location, disposable income and the ability to save. For those on higher-than-average salaries, sharing is often a tactical choice. Renting an average room in a UK flatshare costs £747 per month while the ONS puts the average UK one-bed flat rent at £1,123. That means you’re saving around £4.5K a year on average if you flatshare.”

Household arguments

Mr Hutchinson added: “It’s not always a financial decision though. Some flatsharers on higher salaries still choose to live with others. For those new to an area or leaving their family home for the first time, a ready-made group of friends is a great antidote to loneliness.

“But as our survey shows, wage gaps in flatshares can also be the root cause of household arguments if outgoings aren’t sensitively managed. It’s well worth sitting down as a group to work out the fairest way to split rent, bills, and shared supplies so everyone’s comfortable with the arrangement. There’s no right way to do things, it’s just about finding the best way for your household.”

The data also reveals 29% of people say they have missed out on an opportunity to rent a place with a friend because of the difference between their salaries.