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Surprising new figures published by the Office for National Statistics have revealed that despite popular opinion, private sector rents across London have not increased at quite the rate most people believed was the case.
If you read the popular press, you would be forgiven for thinking that London private sector rents are spiraling out of control.
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Supply and Demand
Well to a certain extent this is true in that supply is being far outstripped by demand and competition for available housing is very high, but the figures show that rents have actually increased by only 11.4% between December 2005 and December 2013, which is a lot less than the cost of inflation as measured by the Retail Price Index. During the same period, inflation was 30.5%.
Far Higher Rents for Housing Association Tenants
By comparison, average rents for local authority housing tenants rose by 36.2%. Even worse, rents for properties operated by housing associations in London rose by a staggering 48.2%.
Passing comment on the news, the Chairman of the RLA, Alan Ward, said:
“These figures burst the myth that it is private sector rents that are spiralling out of control when it is tenants in local authority controlled housing who are facing far steeper increases in rents.
“Although we accept that in some London boroughs rents are relatively high, index linking rents would leave many tenants worse off and would serve only to paper over the true problem – a lack of sufficient homes to rent.
“It is time that the Government recognised renting homes as an active business and supported investment by the army of individuals that make up the majority of the country’s landlords”.
