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Average rents for a two bedroom property increases 26%

INCREASING: Property prices in London continue to increase

AVERAGE RENTS for a two bedroom property have increased 26% since 2011 in London, a new GMB study shows.

Pay has to rise to allow workers to afford these ever-rising rents so the public sector pay cap and the below inflation pay rises in both the public and private sectors has to end to avoid a drop in consumer spending, which, if not checked will lead to a further recession says GMB.

The average rents for two bedroom apartments in Greenwich has risen from £900 per month in 2011 to £1,350 in 2017, an increase of 50%. This is the highest increase in 33 London boroughs.

Next in the league for the increase in the average rents for two bedroom property between 2011 and 2017 is Newham at 47.4%, followed by Barking and Dagenham at 42.4%, Lewisham at 42.1%, Sutton at 40.6% and Waltham Forest at 40.1%.

As a result of these increases the average rents for two bedroom apartments has now risen to more than 50% of gross average earnings of residents in 17 London Boroughs.

These are Westminster, Hackney, Islington, Camden, Brent, Newham, Tower Hamlets, Hammersmith and Fulham, Haringey, Lambeth, Southwark, Ealing, Hounslow, Merton, Barking and Dagenham, Barnet and Greenwich.

In Westminster the average rent for a two bedroom property is 71% of the gross average earnings of residents of the borough. This is the highest in London.

Next highest are 67.3% in Hackney, 63.9% in Islington, 62.1% in Camden, 60.4% in Brent and 60.1% in Newham.

In London as a whole, workers are paying out 53.3% of their earnings on rent, up from 44.9% in 2011. This is significantly higher than the England average figure of 27.4%.

Warren Kenny, GMB London regional secretary, said:

"These figures demonstrate the extent of the squeeze felt by workers and their families in London since the financial crisis in 2008. Rents have surged upwards as pay has been stagnant or falling.

"In addition, they show that a massive programme to build more homes, especially homes for rent, by the London boroughs is absolutely essential in all parts of the region and has to get underway without delay.

"We have been talking about this problem for far too long, there can be no excuses for not providing housing to people that they can afford to live in on average wages. The decisions of the Thatcher government in the 1980’s to sell council housing stock, and not replace it, and to pay landlords housing benefit instead of providing social housing directly has been a huge and expensive mistake. Last year, for example, £24 billion was spent on housing benefit, with much of this public money ending up untaxed in bank accounts in offshore tax havens. If a fraction of that amount had been spent on social housing for rent, the strain on the tax payer would be less and people would have housing they can afford to live in.

"These mistakes need to be corrected without delay, fair and affordable housing is a basic aspiration for all."

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