Renting in London is becoming increasingly difficult for tenants, with new figures showing that renters now need a salary of almost £75,000 a year to afford the average property in the capital.
The latest figures from Propertymark show that average London rents increased by 4.2% in a single month, rising from £2,385 to £2,484 per month.
As a result, the representative annual salary required to rent an average-priced home has climbed from £70,050 to £74,520.
London sees sharpest rise in rents
London recorded the strongest monthly rental increase across the regions, highlighting the continued pressure on tenants looking for homes in the capital.
The North West recorded the second-largest increase, with average rents rising by 1.9%, from £1,110 to £1,131 per month. The salary requirement for tenants in the region increased from £32,700 to £33,930.
Other areas also recorded rental increases, including the West Midlands, where rents rose by 1.7%, the South East at 0.8%, and Scotland at 0.2%.
However, the picture was not the same across the whole of the UK.
Wales recorded a 0.9% monthly fall in average rents, while rents also declined across the North East, South West, East Midlands, East of England and Yorkshire and Humberside.
Renting remains a major affordability challenge
The latest figures highlight just how difficult it can be for tenants to meet affordability requirements, particularly in higher-cost areas such as London.
Across Britain, the average monthly rent currently stands at around £1,544, with tenants needing a representative annual salary of approximately £46,320 to afford an average-priced rental property.
In London, however, that figure is significantly higher.
The £74,520 salary requirement is based on the affordability assessments typically used by referencing agencies when assessing whether a prospective tenant can afford a property.
This does not necessarily mean every London renter must personally earn £74,520. Tenants may be able to meet affordability requirements through joint incomes, guarantors or other arrangements accepted by landlords and letting agents.
Supply remains a key issue
While rental price growth has started to moderate compared with the sharp increases seen in recent years, the underlying problem has not gone away.
Demand for privately rented homes continues to exceed the supply available, putting continued pressure on rents.
Propertymark President Kim Lidbury said that more good-quality homes need to enter the private rented sector, alongside policies that support landlords who invest in rental property.
Without an increase in supply, tenants are unlikely to see significant reductions in rental costs.
What does this mean for landlords?
For landlords, the latest figures demonstrate the continued strength of rental demand in London and other parts of the UK.
Higher rents can provide stronger rental income for property investors, but landlords are also operating in a market where affordability is becoming an increasing concern for tenants.
The figures also show why the UK rental market cannot simply be viewed as one national market. Conditions vary considerably between regions, with some areas experiencing strong rental growth while others are seeing prices level off or fall.
For investors, understanding local rental demand, tenant affordability and available supply remains important when assessing whether a property represents a good buy-to-let opportunity.
London rental market remains under pressure
The latest figures paint a mixed picture of the UK rental market.
Rental growth is no longer increasing at the extreme rates seen during the height of the post-pandemic rental squeeze. However, rents remain historically high, particularly in London, where the average tenant now faces a representative salary requirement of almost £75,000.
Until the supply of rental properties improves, affordability is likely to remain a major challenge for tenants.
For landlords and property investors, meanwhile, strong tenant demand continues to support rental values — but the growing gap between rents and wages is something the sector will need to keep a close eye on.
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