Renting a two bedroom home in Hackney is unaffordable for families earning less than £61,200, according to research by homeless charity Shelter.
The study looked at how much families need to earn to afford to rent a two bedroom home, defining ‘affordable’ as rent taking up a third or less of household income.
It found a Hackney family would need to take home more than £3,960 each month, the equivalent of a yearly pre-tax salary of £61,200. With the typical London household income less than £35,000, the charity is warning that growing numbers of families are at crisis point, paying up to half of their income in rent each month.
Lucinda and her partner, both 30, are teachers renting a one bedroom flat near Hackney City Farm. After living in London for the past eight years, they can no longer afford to stay and are moving to Sheffield this summer.
Lucinda said: “I love London but we can’t stay here. It’s not sustainable. We’ve weighed up the quality of life between living here and in Sheffield where we can afford to rent a four bed place with a garden. There’s no contest really. We can’t afford to rent a big enough place let alone buy anywhere.”
The couple’s rent is £1,000 a month (£500 each) and Lucinda, earns £19,000. She is paying nearly half of her wages on rent and has little disposable income.
Shelter chief executive Campbell Robb said: “The [report’s] findings paint a worrying picture of families across Hackney being stretched to the limit by the cost of renting, praying they won’t be hit by another rent rise that could tip them over the edge.
“As so many Londoners are locked out of home ownership, more and more families have no other option but to rent. But with rents now so out of touch with wages some families are spending over half of their income just to keep a roof over their head, leaving little left for food, fuel and other essentials.”
The report found that inflation rose on private rents in London by seven percent in 2011, almost double the rate of inflation on the average London wage. With no sign of the situation improving, many families are considering leaving London.
In an Ipsos Mori poll released last week, Londoners said that the single most important policy the mayoral candidates have discussed is finding a way to reduce the cost of private renting. Shelter’s Homes for London campaign is demanding the next Mayor stands up for London’s renters by brokering a better deal to protect families from the capital’s soaring rents.
“Hackney’s renters will be looking to the next mayor to fix London’s out-of-control rental market, and give them some stability and predictability with their housing costs,” said Robb.
Find out more about Shelter’s campaign, Homes for London./ 26 April, 2012