Living in London is now more affordable than it was 10 years ago

Living in London comes with the acceptance that you’ll be spending around half of your hard-earned paycheck on rent.

Many of us dream of a time when it was more affordable to live in the capital, and we didn’t dread the landlord’s email heralding a monthly increase.

But while the slog continues for many renters, new statistics suggest that, somehow, it’s become more affordable to rent in London over the last decade. Yes, we’re in as much disbelief as you are.

According to new figures from the Office For National Statistics (ONS), between 2022 and 2023, private renters in the capital spent 39.8% of their gross income on rent alone.

That might sound a lot, but it actually marks a decrease from the 41.8% people were paying between 2021 and 2022. It’s also technically more affordable than the period between 2014 and 2015.

Wondering how rent could possibly be more affordable when it’s still skyrocketing? It’s all about how our wages have increased in line with these rent prices — so because pay has climbed (what is said to be) sufficiently, the gap between earnings and rent has technically become more manageable.

This trend continues across the UK, with households who privately rent also spending a smaller proportion of their wages on living costs.

Crunching numbers

Between 2021 and 2022, and 2022 and 2023, national spending on rent fell (albeit only slightly) from 36.5% to 34.2%, as wages started to exceed rent increases.

Despite this, the broader picture of the London housing market remains grim. As per figures from Zoopla, average rent comes in around £2,100 per month – the highest of any UK region – which marks an annual increase of 6.2%.

Likewise, recent data from SpareRoom finds that London rents have skyrocketed by an average of 32% over the last five years, from £744 to £983 per month.

However, the average Londoner takes home £41,866 per year — significantly higher than the typical UK salary of £33,000.

Analysing postcodes across the city, the largest increases were seen in locations across the East and South East, with the most significant being in SE2 (spanning parts of Greenwich and Bexley, including Abbey Wood). Here, monthly averages have risen from £531 to £820.

Other postcodes of note include EC2 (Shoreditch and Liverpool Street, with a 53.4% increase), N9 (Edmonton and Enfield at 49.7%), and SE9 (parts of Greenwich, Bromley, Bexley and Lewisham at 49.6%).

However, these statistics are averages – and there are plenty of people who are still paying above the odds just for their four (rented) walls.

In August 2022, a Reddit thread asked Londoners what percentage of their monthly salary they spent on rent. Shockingly, many were spending even higher than 50%.

‘After tax and including bills it’s around 65%. It’s quite high but I live alone in a studio close to work and I don’t want to go back to renting a room in a flatshare in zone 4,’ @wutetka penned.

Meanwhile, @_perpetually_curious shared that they were shelling out around 70% including bills ‘to live in zone 2 in a three-bed flat share.’ Ouch.

For @pepe_za, the figure (including rent, council tax and utilities) was 67.5%.

Elsewhere, others have dedicated their time to reminiscing about what they used to pay in days gone by.

When @Hot_Photograph_5928 first moved to London in 1994, they shared a three-bedroom house with one other person and paid £200 per month, including council tax.

‘First salary (graduate job) was £17,850,’ they added. ‘Things were different.’

Almost 20 years later, in 2013, @Western_Discount6044 was paying £650 including bills for an ensuite in Norwood, South London. By 2014, their rent increased to £1,120 – excluding bills – for a one-bedroom flat in the Isle of Dogs.

If only we could all have the idyllic rent prices of the 1990s on a 2024 wage, hey?

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