Housing the top concern in survey that reveals the worst and best of London

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A survey of nearly 4,000 Londoners has found that their greatest worry is the cost finding a place to live.

When asked to identify the worst thing about living in the capital 31% of the responses pointed to the cost of a housing and a further 28% to the general cost of living.

Just 8% say they are satisfied with housing in London. Their concerns cover the availability of low cost homes to buy and the high cost of rents. Only 10% believe that the homes being built currently are affordable for a range of people. As revealed by Urbs, much of the housing labelled as “affordable’ is beyond the means of many.

There is also dissatisfaction with the private rental sector. 71% of respondents said there is a lack of affordable private rental property and most are unhappy with the quality of the rentals that are available.

The survey is the second Annual London Survey carried out by City Hall.  It polled 3,861 people online at the end of 2015.  The participants were self-selecting but the data was weighted to reflect the gender, age and ethnic mix of London.

Around half the people polled have lived in the city for more than 20 years.  More than a quarter had lived in their local neighbourhood for the same amount of time.

Their other big concerns shown in the survey included 67% of respondents who said that they were dissatisfied with the fairness of wages, 62% unhappy about the affordability of public transport and 57% dissatisfied with air quality.

But there were some positives to living in the capital.  The thing identified by most was simply the huge variety of things to do.  Access to museums, galleries, theatres and live music emerged as one of the big pluses of London life for many.

Despite the problems, more people like rather that loathe London life.  Overall, 75% said they are satisfied with London as a place to live. But when asked about the future they came back to their chief concern: housing.  The issue most mentioned as the challenge facing the capital is building affordable homes.  It’s an issue that the Mayor himself has called an epic challenge.

Source data

See also

The jobs success and housing failure causing a crisis for the capital

Under 40s locked out of housing market destined to be “generation rent”

More “affordable” homes but the rents prove unaffordable for many

Social housing rental defies location-driven pricing of private sector

council housingLocation, location, location are often quoted as the 3 watchwords of property pricing as the area in which you choose to live has such a huge impact on the costs of buying or renting a home.

While that is true of the private market the social rental map of London offers a very different picture. Kensington and Chelsea, and Westminster are the most costly places to rent a home in the private sector. But average weekly rents for social housing are highest not in these expensive central boroughs but in Newham and Camden.

Social housing provides an affordable alternative for people who do not have the resources to buy a property or rent in the private sector. It is provided by local authorities and by Registered Social Landlords, defined as those that manage at least 1,000 homes. These can be charities or companies; most are housing associations.

Rents charged by social landlords are much lower and increases are controlled by a formula put in place by the government. Government policy for the past 15 years has been for rent convergence in social housing to ensure that similar homes in similar areas are charged at the same level. In order to achieve this it set target prices with those below the rate given some scope in the rent formula to gradually get prices up.

This more uniform approach produces a surprising rental map of London. Urbs looked at data from Registered Social Landlords gathered by the Department for Communities and Local Government. Newham and Camden emerge with the highest average price while one of the most costly areas for private rental, Kensington and Chelsea, is cheaper than Barking and Dagenham.

The data does not make clear the nature of the housing stock but tells a story of relatively level average rental pricing.

Social landlords

Using data from the Office for National Statistics in its Index of Private Property Rental Prices Urbs has previously looked at rental prices across London. The map shows a very different picture with sharp difference between monthly rental costs in central boroughs and outer areas.

Rental all prop map

In the last budget the Government revealed plans to extend the Right to Buy policy to housing association tenants, allowing them to own their rented home. While tenants who rent from Registered Social Landlords in central areas are paying similar rents to those in outer areas their properties are likely to command a much higher market value if they become part of the private housing sector.

Source data

See also

Families face the biggest premiums for renting homes in the capital

Under 40s locked out of housing market destined to be “generation rent”

Urban chic or leafy charm? Inner city rentals catch up with affluent areas

Renting in London: 4 bedroom homes

The Royal Borough of Kensington and Chelsea, as its name suggests, has a number of esteemed residents living in larger properties. The area has streets of fine Georgian terraces and median rental on larger properties is the highest in London, and the highest in the UK at more than £9,000 a month.

Westminster is the second most expensive at £7,800, but these two boroughs are far removed from the rest of the market.

Rental 4 bed map

The wealthy West London boroughs of Richmond and Hammersmith and Fulham are in the next price tier along with Camden and Islington.

Central areas such as Tower Hamlets, which has expensive smaller housing stock through the development of areas like Canary Wharf and Limehouse, is cheaper for this size of property and in line with outlying boroughs such as Merton and Barnet.

Sutton and Bromley are noticeable more expensive than the boroughs in the east of the capital, while their prices have been more in line for smaller properties.

For bigger properties the gap between London and non-London prices is smaller than the premiums for 1,2 or 3 bedroom properties – it is only twice as expensive.

Rental 4 bed

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Renting in London: 3 bedroom homes

The additional cost of living in London for a family seeking a 3 bedroom house is punishing. As previously reported by Urbs, the premium charged is at its highest for this size of property, 150% above median rent for England.

Renting 3 bed

The nature of the housing stock in different parts of the city becomes more apparent in the map for this size of property. There is no data for the City as it has so little of this sort of housing. Kensington and Chelsea does have supply of medium sized homes, but at a huge premium, more than 3 times the median rent.

The inner boroughs and the leafier neighbourhood of Richmond can command rents in excess of £2,000 a month. Further out in boroughs like Harrow and Merton prices drop to around £1,500

Rental 3 bed map

Data from the Valuation Office Agency, the body that advises the government on property values, shows that it is only in the 3 most easterly boroughs that median monthly rental is at £1,200 and below.

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More on Renting in London

Renting in London: 2 bedroom homes

The additional cost of living in London really begins to show in 2 bedroom homes. For families who need more than a single bedroom the median price in London is £1,400, that’s 135% above the median price for England.

Rental 2 Bed

Data from the Valuation Office Agency, the body that advises the government on property values, shows the highest prices in the capital are in Kensington and Chelsea, and Westminster, with the City close behind.

Camden and Islington are in the tier below with median rental around £1,900 a month followed by the ring of inner boroughs and Haringey.

Rental 2 bed map

As with smaller properties, median prices are lowest on the south and east edges of the capital.

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More on Renting in London

 

Renting in London: 1 bedroom homes

For a single person or a couple the step up in monthly rental from a studio to a 1 bedroom flat costs an additional £300. The median rental price in London for a 1 bedroom home is £1,155, more than double the median price for England of £525.

Rental 1 Bed

Data from the Valuation Office Agency, the body that advises the government on property values, shows the highest prices in the capital are in Kensington and Chelsea and Westminster, with the City close behind.

Camden and Islington have prices in excess of £1,400 and there is a ring of inner London boroughs, from Hackney in the north east to Hammersmith in the west and Lambeth in the south where monthly rents are still above £1,200.

Rental 1 bed map

Further out, prices are broadly the same in Barnet, Hounslow or Merton. Cheaper prices can be found in the south, in Sutton, Croydon and Bromley. But only Havering, Barking and Dagenham and Bexley offer a median rent below £800 a month for 1-bedroom properties.

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Renting in London: A Studio

A studio flat is typically a single room for living/sleeping with a separate kitchen and bathroom. It’s the smallest type of self-contained home and renting one will set you back around £850 in London. That’s £350 more than the median price across England as a whole.

Rental studio

Data from the Valuation Office Agency, the body that advises the government on property values, shows the capital itself has an enormous range in prices from £1,387 in the City to £525 in Bexley.

The price differences are more marked than for room rentals as you travel out from central London with options going from around £1,000 in central boroughs to £750-£850 in inner London and £650-£700 in most outer boroughs.

Rental studio map

As with room rentals, the cheaper options are in the east of the city in Havering, Barking and Dagenham and Bexley. Bromley, Sutton and Hillingdon are also cheaper locations.

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Renting in London: A Room

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Renting in London: A Room

For many people coming to London, particularly younger people, their first experience of setting up home in the capital is renting a room in a shared house.

As with all levels of property, that’s considerably more expensive than in the rest of the England; £525 per month compared to £341, according to the Valuation Office Agency, the body that advises the government on property values.

Rental room

But across the capital, are there any bargains to be had in the communal living lifestyle? The closest you will get to the England average is in Havering where a room costs £417. Prices are generally cheapest in the east of city where there are 6 boroughs with monthly prices below £500.

Rental room map

Across the capital Croydon, Sutton, Hillingdon, Harrow and Enfield also duck under the £500-a-month bar.

At the other end of the scale, you can pay double that in the City and not much less in Westminster and Kensington and Chelsea.

Source data

Renting in London: A Studio

More on Renting in London

Families face the biggest premiums for renting homes in the capital

terrace on hil-2The punishing premium on private rents in the capital is more severe for families who need 2 or 3 bedrooms. Rents for 1-bedroom properties are more than double in London but for those with children as well as themselves to house, a home may cost 150% more to rent.

Urbs analysed the latest data from the Valuation Agency Office, a body that advises the government on property prices, to look at the cost of different types of rental property in London.

We looked at median prices to iron out the highs and lows that affect averages.

Median Monthly Rental
London England
Room only £525 £341
Studio £850 £500
1 Bedroom £1,155 £525
2 Bedroom £1,400 £595
3 Bedroom £1,695 £675
4+ Bedroom £2,500 £1,175

The premium paid for renting in the capital is significant for all types but highest for medium size flats and houses.

Rental private premium

The most expensive region outside of London is the commuter area of the South East. Comparing the median rate for all properties the monthly cost in the South East is £779 but nearly double that at £1,350 in London.

But London itself see distinct variations with the highest median rate for all properties in Westminster, and only 4 boroughs – Sutton, Havering, Barking and Dagenham and Bexley, where it is below £1,000

Rental all prop map

Other data from the Office for National Statistics shows private rents continuing to rise. The Index of Private Housing Rental Prices, a quarterly index that tracks the prices paid for renting from private landlords shows a 4% rise between April and June compared to the same period last year.

Over a 10-year period prices in London have risen by 35% compared to 17% for the rest of England. The 4% rent inflation is a return to the higher levels of 2013 after less steep rises in 2014.

monthly rental

The last dip in rent inflation was in 2010. Since then prices have risen steadily with rises in London at least double the rate in the rest of England.

The affordability of property means home ownership is beyond the means of many in the capital and renting in the private sector is the only option. As previously reported by Urbs, there is a growing concern than many younger people will never be able to save enough for a deposit to buy a property in the capital and they are becoming a so-called ‘generation rent’.

Index of Private Housing Rental Prices

Valuation Office Agency

See also

Paying the rent takes up 72% of income for private tenants

Under 40s locked out of housing market destined to be “generation rent”

Urban chic or leafy charm? Inner city rentals catch up with affluent areas

 

Under 40s locked out of housing market destined to be “generation rent”

Keys-2The under 40s in London will be locked out of the housing market as renting becomes the long-term norm. This is the gloomy forecast by economists at accountancy firm PwC, who say that changes in the housing market mean that those aged 20-39 will become “generation rent.”

Private rental has increased from 10% of the housing market to 20% between 2001 and 2014. According to the English Housing Survey, as reported here by Urbs, a quarter of all private rental properties are in London. PwC forecasts that a further 1.8 million people will join the private rented sector by 2025. And private rental will be the housing solution for more than half 20-39 year olds.

In its UK Economic Outlook for July PwC says that a number of factors are changing the nature of housing tenure in the UK:

  • Affordability – the growth in house prices has declined, especially in London, but has  outpaced the growth in pay. The earnings to house price ratio is at its highest in London, passing the previous record in 2007. A tightening in mortgage lending means that saving for a deposit is beyond many first time buyers
  • Housing Supply – house building in the UK has been insufficient to meet demand for decades but this problem has intensified in the past five years. There is a shortage in both the private sector and in social housing.
  • Demographic change – the share of the housing market of people who own their home outright will rise by around 2 million by 2025.  This is due to an increase in the UK population of over 60s who have been able to pay off their mortgage.
% share of households by tenure 1981-2014
housing tenure

Source: PwC analysis of English Housing Survey, DCLG

PwC also warns that kicking away the property ladder from the under 40s will have a long-term impact on wealth. It says that house purchases have driven wealth for lower and middle classes and an inability to enter the housing market may limit social mobility.

For many in London long-term rental is already a reality. PwC says that private rental is common in other European countries but there is a higher quality of property and security of tenure beyond a year. This is yet to happen in the UK private rental market.

See also

Paying the rent takes up 72% of income for private tenants

How “Millennials” are driving an urban renaissance

Urban chic or leafy charm? Inner city rentals catch up with affluent areas