One in seven tenants privately renting from a landlord is paying more than half of their income in rent, compared with just 2% of homeowners who pay more than half their income on their mortgage, according to new research.

The Local Government Association, which compiled the figures, said high rents were preventing young adults from saving up for a deposit for a home of their own. It said the average deposit now cost 71% of a first-time buyer’s annual income.

The research also found that four out of 10 private tenants spend more than 30% of their pay on rent, compared with only 11% of those with a mortgage.

Private rents currently average £852 a month across Britain, although the figures are skewed by high costs in London.

The LGA is calling for the government to give councils powers to fund more affordable homes and social rents. Last year, there were only 30,000 new affordable homes built in England, the lowest number in 24 years. Councils say they need to be able to borrow to invest in housing and to keep 100% of the receipts from any homes they sell to replace them.

Councillor Judith Blake, LGA housing spokesman, said: “When one in seven private renters is spending half their income on rent, it’s no wonder we have a rental logjam – with a shortage of homes with genuinely affordable rent, and young people struggling to have enough income left over to save for a deposit.

“A thriving private rented sector helps create a balanced mix of available housing. A new wave of genuinely affordable homes for rental, that cost 30% of household income or less, would provide tenants with stability, reduce the squeeze on household incomes and help more people get on the housing ladder.”

There has been mild relief for tenants in some parts of the country, with evidence that private rents have fallen in London and the south-east over the past year. One rental index last month showed that average UK rents had fallen for the first time since 2009, with the biggest declines in London.

Tenants will also benefit from a long-awaited ban on fees imposed by letting agents that was confirmed in the Queen’s speech, and a new cap on deposits limiting them to just one month’s rent.

But while rent rises have plateaued, critics say this has only come after many years of outpacing rises in earnings.

Research by the Chartered Institute of Housing last week found that rents across England grew an average of 14.6% from May 2011 to May 2017 while wages increased 10% over the same period. In London, rents have increased 22% over the same period.

Terrie Alafat, chief executive of the CIH, said: “This analysis reveals just how stark the growth in private rents is in London and the south-east, where it is clear there is now a very significant gap between the amount people earn and the cost of their housing.”



Councils are swimming against a tide of right to buy sales that means they are losing much more of their stock than they are replacing. It emerged last year that 54,581 units of social housing have been sold since David Cameron’s government boosted the discounts in 2012, but work has begun on only 12,472 replacements.

The Association of Residential Letting Agents is forecasting that rents will start to rise again in coming months. Its latest survey of members found that 27% put through rent rises in May – the highest level since July 2016. It said just 2.8% of tenants had managed to negotiate a rent reduction last month.

It also forecasts that rents will rise by £103 to compensate for the loss of letting fees, although the evidence from Scotland, where a ban was put in place several years ago, is mixed.