Tenants face an affordability crisis as they spend 41% of their income on rent

The cost of renting in the UK means that tenants are now parting with 41% of their take-home pay to cover monthly rent, a report reveals.

The findings from tenant and landlord services provider Canopy, found that the figure is up from 40% in the first quarter of this year.

It’s also a 5% rise compared to last year and signals a worsening affordability crisis for renters across the nation.

Tenants are living on the edge

The firm’s chief executive, Chris Hutchinson, said: “Our latest figures for April to June reveal the ongoing rental affordability crisis across the UK.

“With the average tenant now spending just over 40% of their take-home pay on rent, it’s clear that many are living at the edge of financial comfort.”

He added: “London continues to stand out as the least affordable city, with tenants in boroughs like Enfield spending more than half of their income on rent.

“Meanwhile, more affordable areas such as Hull and Blackburn offer some relief but may face increased demand as rent rises elsewhere.”

He also says that wage growth is still struggling to keep pace with rental inflation, so tenants have less disposable income for essential living costs or saving for the future.

Typical rent is £854

The research reveals that the typical tenant now spends £854 per month on rent, an increase of £35 from last year.

Canopy’s Rental Affordability Index, which compares tenants’ take-home salaries to their rental costs, shows that most renters are pushing the boundaries of financial sustainability.

The firm says that spending 40% of income on rent is widely regarded as the upper limit of affordability, leaving many households with little room for other essential expenses.

London remains the most challenging city for renters, with the average tenant in the capital spending 47.7% of their wages on housing.

Areas where rent is 50% of income

In seven London boroughs, including Enfield, Haringey and Brent, tenants are forced to allocate at least half of their income to rent, with Enfield being the least affordable at 56%.

This marks a rise from five boroughs exceeding this threshold in the previous quarter.

In contrast, Hull is the UK’s most affordable city for renters, with tenants spending just 31.9% of their income on rent, overtaking Doncaster from earlier this year.

The North East of England also stands out as the most budget-friendly region, with tenants spending 34% of their pay on rent.

Outside major cities, Dumfries leads as the most affordable postcode area at 30.9%, followed closely by Blackburn (32.1%) and Halifax (32.2%).