(Bloomberg) -- Four in 10 renters moving home in London last year chose to leave the city as pricey monthly payments squeezed budgets to the limit.
More than 90,000 rental households left London in 2022, according to a report from broker Hamptons International. That’s the most in more than a decade and more than double the amount that moved from the city in 2012.
“The rapid recovery of London rents over the last year has left record numbers of tenants looking around for cheaper options,” said Aneisha Beveridge, head of research at Hamptons. “Rents show few signs of deviating from their upward trajectory.”
The average monthly rent paid for a newly let home in Greater London rose 9.1% year-on-year to £2,141 in January, outpacing growth of 8% in the rest of Great Britain excluding the capital during the same period. Londoners spent more than double the amount on rent than the rest of Britain, which saw the average monthly price rise to £987 last month.
The exodus of tenants marks a reversal of 2021, when more homeowners fled London than renters for the first time in a decade. Renters are at the sharp end of Britain’s cost-of-living crisis, with 8% of private tenants falling behind on housing costs in the three months to November.
That’s forcing thousands of Londoners to hunt for cheaper deals. Tandridge — a district just south of the capital in Surrey — saw over half of its new tenants move from London last year, as leavers increasingly kept their job in the capital while working remotely or commuting to the office.
The shift to flexible working since the pandemic has meant fewer London tenants are leaving the capital for a new job. Only 22% of leavers left for work-related reasons last year, down from 32% five years earlier, according to Hamptons.
Instead, tenants are leaving London to make their budgets stretch further and live in larger homes. Rents achieved for one-bedroom properties in Britain grew faster than bigger homes for the seventh consecutive month in January, the report said, providing an extra incentive to rent bigger homes in the suburbs.
“We expect the number of renters leaving the capital to continue rising for the foreseeable future,” Hamptons’ Beveridge added. “As younger generations are less likely to own their own home, leavers are increasingly likely to be renters rather than homeowners.”
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