Surging rents ‘fanning the flames of cost of living crisis’

Rents have surged 8.3 per cent in a year, to the highest level they have been in 13 years.

London rents have risen 11 per cent in a year as office workers have returned to the capital.

Monthly rents are up £62 since the start of the pandemic, hitting an average of £969 a month, according to new data from Zoopla.

A single person spends more than a third of their income on rent, at 37 per cent, research found.

Sarah Coles, senior personal finance analyst, Hargreaves Lansdown, said: “Rent hikes are fanning the flames of the cost-of-living crisis. Tenants have already been badly burned by rising prices, so higher rental costs risk sending their finely balanced budgets up in smoke.”

She added: “Any renters under the age of 32, won’t have known a time when rents were higher.”

It comes as households are braced for rising costs this spring with energy bills to rise 54 per cent, as well as hiked national insurance taxation.

Separately, Knight Frank research found that the annual change in rental value in prime central London hit 19.8 per cent in January, which was the largest jump since the index began in 1995.

Elsewhere, in prime outer London, the change was 16.6 per cent, the biggest increase over the same period.

Tom Bill, head of UK residential research at Knight Frank, said: “It has tailed off in recent months as the supply and demand imbalance corrects itself but that process still has some way left to run, which will keep upwards pressure on rents this year. The unprecedented backdrop of the pandemic led to exceptional rental value growth last year.”