Record High for Private Rents During COVID-19 Lockdown
New figures show that average rent prices in the private-sector hit a record high of £700 per month in England just before the country went into lockdown.
According to the latest data from the Office for National Statistics (ONS), London had the highest median rent at £1,425 per month. The lowest median rent was in the north-east of England at just £495 per month.
Westminster was recorded as the most expensive locale to live in, where the median monthly rent was £2,492. The cheapest location in England was Hull, where the median monthly rent is just £420.
The data spans the twelve-month period from 1 April of last year until 31 March this year.
The ONS observed that the cost of rent ‘has not been higher’, which will fuel concerns about the affordability of living. Previous research has shown that an average of 41% of a renters income is spent on housing costs.
When the lockdown was enforced, payment holidays were given to mortgage holders and landlords, however the 8.5 million private renters in England had to hope that these holidays would be passed on.
The government made a two-month extension to its eviction ban in England and Wales last week. This will give thousands of renters some more breathing space during the lockdown.
Policy manager at campaign group Generation Rent, Caitlin Wilkinson, said: “At the outset of this crisis, renters were spending more on housing costs than at any time previously. In light of these figures, it’s not surprising that many private renters who have since lost income are struggling to make ends meet.
“While we don’t yet know the impact of the pandemic on rents, we do know that more than half of tenants who have requested a rent reduction have been asked to pay in full. These figures highlight the need for the government to provide rent relief to those struggling with sky-high rents as part of the UK’s coronavirus recovery strategy.”
Even if the COVID-19 pandemic causes a slump in house prices, few housing experts are anticipating rent prices to fall by a significant amount.
Researchers at Savills UK now expect a 7.5% fall in house prices this year, but are predicting a fall of just 1.5% in rent prices before a 5.5% rise in 2021.
“Rental values tend to be more resilient than capital values during a downturn. Rents fell just 2% following the financial crisis, whereas house prices fell -18%. We expect rents will also remain relatively resilient in the coming months and years, albeit there may be greater pressure in areas more reliant on international tenants and students,” said Savills.