The average first-time buyer will have to spend a staggering £64,400 on rent before getting on the first rung of the property ladder, new figures have revealed.
According to Association of Residential Letting Agents, people are currently paying £52,900 on rent by the time they buy a house and this is set to increase by 22%.
The report reveals the average first-time buyer in in 2016 will have spent 16.4% of their total lifetime earnings on rent while they are a tenant.
David Cox, managing director of ARLA, said: “Rents are becoming alarmingly unaffordable due to the lack of available housing. The North-South divide we’re currently seeing in the UK is a clear illustration of this.
“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, as Londoners relocate to avoid high rent costs.”
Those buying a property for the first time in the North East will have to spend £31,300 on rent, the lowest amount in England.
Meanwhile, in London the average amount spent is more than double this at £68,300.
The only place outside of the capital where the total lifetime rent spent is above the English average is the South East at £55,900.
Jeremy Leaf, a former RICS chairman and north London estate agent, said: “The amount of rent the average first-time buyer has to cough up is truly staggering. It is no wonder that the average age of a first-time buyer keeps rising as saving the necessary deposit in order to buy, while paying such high rents, is a hard task.”
Rising rent costs
The average rent in the UK, excluding Greater London, is now £740 per month.
The South East of England and the East Midlands had the highest annual rent increases in the UK over the last year.
According to the latest HomeLet Rental Index, rents rose 7.2% to £933 in the South East and 6.8% to £646 in the East Midlands.
Greater London rent was up 6.2%, the slowest rate of growth seen in the capital since March 2014. The average rent in London is now £1,510 per month.
Brits moving out of the family home at the age of 18 will typically rent for 13 years before buying their first property.
Those leaving home and starting to live independently in London will continue to be worse off, as they will spend an average of £91,500 on rent before they can buy their first home – £23,100 more than those buying in the capital this year.
Leaf said: “There is a desperate need for more housing supply and better overall market accessibility for affordable homes in particular, in places where people want to live and work. The deluge of applications for the London Help to Buy scheme demonstrates just how many people are struggling to get a foothold on the housing ladder.
“If landlords do exit the buy-to-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. First-time buyers may find their already steep rent bill increases further unless the lack of supply is addressed.”
