We were shocked at how high the rent increase was.
My flatmate and I wouldn't be able to afford that increase based on the jobs we have and what we
currently earn.
We love this area and we've lived here for the past six years.
We desperately wanted to stay and we were more than prepared to stay.
London rents increased by 17% during 2022.
That's the highest year-on-year increase the city has recorded since 2007.
On average, London's renters who are single earners spend
48.4% of their income on rent.
In 2021, that figure was just 42.7%.
Many renters are fighting their landlords on proposed rent increases or being forced to move as they can
no longer afford to pay rent for their homes.
Upon closely reading the tenancy agreement with our other tenants in the
building, we realized that together we could communicate in a way that would
challenge the process of the proposed increase.
There was no way that we could afford to heat or eat on that
budget, with our rent probably being about a good 90% of
my pay packet.
There are also no rent controls in London, meaning that landlords have the power to charge as
much rent as they think is reasonable and can get.
In a highly competitive market with more demand than supply for rental properties, this has led
to sky high prices that are unaffordable for many.
Renters can try to negotiate or say no, but then they run another risk:
being evicted.
My name is Daniel Lloyd. I'm 26 years old and our landlord has proposed to increase our rent by
27%.
My name is Dave Chawner.
I'm 33 and our rent went up 26%.
So how did we get here?
And what does it all mean for renters in London?
London is a city of close to 9 million people spread out over around
607 square miles, which is about twice as large as New York
City. From skyscrapers in the city center to family homes in the
suburbs, it is a highly diverse city and an international hub.
Inner London covers the sort of central part of London, it covers an area that sort of maybe
20 to 30 minutes commute by public transport.
It covers all the international areas.
When you get out into the suburbs of London, which is far more of a market dominated by houses, maybe
sort of 35, 40, 50 minutes commute out of the center, rents
fall. So moving into outer London, there's better value for money.
And so you get people on higher incomes moving there.
The other thing I'd also add is London has seen a lot of improvement in public transport.
So we've also opened up new markets.
Strong transport links are one of the advantages Daniel and his flatmate enjoy about their
home, which is located in outer London.
London is just the best place to live.
There are so many things to do outdoors and indoors.
The transport links are fantastic and enable us to get to all sorts of different
places, to see different people, to meet different people.
Daniel and his flatmate also have to live in London for their jobs.
We love the city and the opportunities that it gives.
For me as a reporter, I travel a lot to motor races.
Therefore I need access to London's airports.
As a writer and comedian, Dave's job also ties him to the city.
I unfortunately don't really have too much choice in where
I am based, so I have to really be in the capital.
I love London.
It's absolutely incredible.
I think it's a beautiful city to live in and to be honest, I think it gets better as
time goes on.
When the pandemic happened, lockdowns meant that London was suddenly much less attractive
to live in. Restaurants, bars and activities were shut down, and
working from home meant people no longer had to live in the city to commute to work.
So what we saw over the pandemic was a big hit to demand.
People couldn't travel to the UK, offices were closed, the economy effectively shut down and the
supply of rented homes increased as landlords who typically rent properties to tourists and
short term visitors put those homes into the long term market.
And so we saw rents fall by about 10 to 15%.
The market was on the side of renters.
But as London and the world reopened, the dynamic on the rental market shifted, with
prices soaring.
In December 2022, the median asking rent for a two bedroom flat in
London was £2,400, compared to
£1,900 before the pandemic.
We started 2021 with a massive oversupply of properties .
In some parts of London, and there was a 50%, 60% increase in properties on the rental market.
So prices were still 20% down from kind of
2019 levels.
The demand and supply curve had definitely leveled out, which
then bought the beginning of 2022, which was completely different
and the demand was high and then the stock levels have dramatically reduced.
Daniel lives with his friend in a two-bedroom flat in southwest London.
They moved into the flat in November 2021 and paid a total of
£1,400 a month.
In October 2022, their landlord proposed to increase their rent by
27% to £1,775.
The issue is not just affecting them, but almost everyone living in their building.
We understood that some people in some flats were having their rent increased by £100 per
person. That prompted us to knock around and gather people's numbers, get a group chat
together on WhatsApp to discuss our rent situations.
And it was there that we found out that people were facing increases in excess of
25%, some as much as 30%.
Daniel and some of his neighbors also have a clause in their leases that limits by how much
rent can be increased and believe the landlord's initial suggestion would breach
this. They reached out to their property manager to negotiate the increase and
received a new offer of £1,750 a month, only
£25 less than the original suggested rent increase.
They continued to push back but have not heard anything new from their property manager.
We have used the time to get legal aid from other organizations that are involved in
renters rights, so we have an idea of what directions they could take.
But ultimately we're currently sitting waiting, nervous to see what they're going to say.
High prices and low supply have led to fierce competition amongst renters who
now often feel they have to go to great lengths when trying to secure a property.
We often don't have to ask tenants to offer over asking price.
They just offer over asking price because they've lost out on the last two or three properties that they've
bid for. They're offering long leases realizing that they probably don't want to be
looking again in another year.
I mean, they sent us in bios, they sent us some pictures.
Applicants who have got pets sent us like pet CVs.
Many people here in London are feeling overwhelmed with the task of finding a new home.
Properties are disappearing from real estate websites within hours, so people need to react to
new listings immediately.
Scrolling through online property listings.
You might find flats advertised for two people, but with bunk beds or rooms so
small, the door doesn't fully open before hitting the bed frame.
These flats now seem to cost what generously sized spaces did just a year ago.
So supply and demand are really out of kilter at the moment.
On the supply side, the average London estate agent would typically have had 17 to 20
properties for rent on their books.
That's down to ten or less than ten at the moment.
So there's a real scarcity of homes for renters looking to rent.
And now the economy is opening up.
Tourism has restarted.
We've also got mortgage rates increasing in the UK.
The market is driving this, not estate agents and not landlords and I think that's probably the
misconception. Tenants know they've got to spend over the asking price.
We're not necessarily asking them to do that.
They are coming forward with a really good offer because they know if they don't offer that, then
they're going to lose out.
Many of London's renters, including Dave and his partner, have been forced to move.
He has been living in the city for around 11 years and lived in his previous flat in South
London for six of them.
Dave and his partner paid £950 a month for the one bedroom flat.
But in July 2022, his landlord proposed to increase rent by
26% to £1,200.
We were surprised at how much the rent was going
up. And when we said, "Look, I think it's reasonable that there is going to be
inflation, I think it is reasonable that prices do go up.
We will negotiate at, say, 15%.
Does that sound good to you?" And they said, "Absolutely not.
It's 26% increase or nothing." I think paying the higher rental price is
absolutely never an option.
But also the fact that the landlord is so openly showed a disregard
not only for our wellbeing but also our safety and health.
There were people using drugs on our doorstep, there were people urinating
on our doorstep as well.
They'd set up a gas meter wrongly and also I think unsafely
as well.
Many of London's renters are still facing an uncertain future as pressures on
the rental market are not expected to ease.
Well, I think we're seeing the worst of the big increase in rents that we have.
But I'm afraid I think rents are going to keep rising at a reasonably rapid rate,
maybe in the 4% to 5% bracket, largely because we just don't have enough
supply coming through. We really need to see more supply in London.
A lot of that is going to come off newbuild development.
My advice would be to act quickly.
It's really important that the references are completed within 24 to 48 hours.
It's really important that the contract is signed within 24 to 48 hours.
So I would advise renters to think hard about what they'll compromise on.
They will definitely have to be a compromise.
After saving for over a decade, Dave and his partner were able to purchase a flat
together on the edge of inner London.
Their monthly mortgage is now lower than their increased rent would have been.
We were incredibly fortunate in order to be able to
buy somewhere, and I know not everyone is that fortunate as we were,
but the difference is now, instead of paying rent to pay somebody else's
mortgage, we're now paying our own mortgage to hopefully one day
when the year 3000 comes to actually pay off our own mortgage.
Dave is also hopeful that there will be long term savings as him and his partner can
maintain the flat well and make small repairs themselves.
In the long term, actually owning our own flat and being able to nip things in the bud
and maintain the place as it should be, will actually save us more
money.
However, buying a property is not an option for the majority of renters in inner
London, as the average property price is £638,000.
Daniel and his flatmate are not sure whether they will be able to stay in their current home, so
they have been looking at listings for rental flats.
It's difficult admittedly, to find a two double bedroom flat in London
because space is at a premium.
However, we have found a few things a bit further out.
We would lose a lot of our transport connections that we have to central London.
Paying the higher rent would be impossible for Daniel and his flatmate.
The only other options would be to move back to our parents houses.
But we're 26 year old professionals.
It wouldn't be fair on our parents to do that.
So we're determined to remain in our current property, to
fight back against the landlord and to state our claim and get a
level of increase that is acceptable and not at the high levels that they've been
proposing to multiple people in the building.