A report from the Association of Residential Letting Agents (ARLA) has found that the average first-time buyer in the UK will have paid a total of £52,900 in rent before getting their foot on the property ladder.
The report shows the staggering rate at which both rental costs and hose prices have been increasing in recent years, making it not just more difficult for the younger generation to buy their first home, but increasing the interim costs before they do.
The figures from ARLA apply to first time buyers looking to purchase their property this year, for those starting to rent now, they can expect to have paid an average of £64,400 by the time they come the buy their first home.
The figures were generated for ARLA by the Centre for Economics and Business Research and are based on the average person leaving their family home aged 18, and renting until the age of 31 and the £52,900 figure is a national average ñ the figure for London goes up to £68,300, while in the cheaper north-east, it is lower at £31,300.
London and the south-east (with an average of £55,900) are the only areas where their figure is above the average for the UK.
ARLA ‘s managing director, David Cox said: “Rents are becoming alarmingly unaffordable due to the lack of available housing” adding that “the north-south divide we ‘re currently seeing in the UK is a clear illustration of this.”
Speaking about the capital, he said: “the London rental market is competitive, with far more prospective tenants looking for properties than actual houses available. This is pushing up rents in the capital, which will continue to put pressure on surrounding areas, including the south-east of England, as Londoners relocate to avoid high rental costs.”
The problem, he said, is one that is only likely to get worse, as the various factors contributing to unaffordability intensify, especially with an interest rate hike on the horizon.
Mr Cox said: “as house price affordability worsens and interest rates start rising, more pressure will be put on renting with weekly rent likely to rise, so home ownership will remain out of reach for many.”
Jeremy Leaf, who used to head the Royal Institute of Chartered Surveyors, also warned that the stamp duty changes coming into force in April may actually have an adverse effect on exactly that which they were designed to solve.
“If landlords do exit the buy-let sector en masse post-April as higher stamp duty and less beneficial tax breaks come into force, rents will only rise because there will be fewer properties for tenants to choose from.”
Overall, across the UK, rent prices increased by 2.5% over the course of 2015, with England leading the charge with an average increase of 2.7%. Within England, London unsurprisingly saw the largest increase, of 3.9%.
Highlighting the increasing unaffordability of rent, tenant evictions hit record levels last year, with 42,728 households being kicked out of their rented accommodation due to problems paying their rent.