UK Rents Rise Faster in Deprived Areas, Drag More People into Poverty

People living in the most deprived areas of Britain have seen their rents increase by 52% over the past four years – while for tenants in the wealthiest regions, rents have risen by only 29%, new figures showed.

“It is shocking to see that home rents have been rising in areas where people are least able to afford to pay more,” said Dan Wilson Craw, deputy chief executive of Generation Rent.

The countrywide data analysed by the estate agent Hamptons and shared with the Observer reveals how, in 2019, renters in the most deprived regions were paying an average of £499 a calendar month – by 2023, that had shot up to £759.

In contrast, those renting a property in Britain’s most affluent districts were paying an average monthly rent of £1,078 in 2019, going up to £1,387 this year.

Polly Neate, chief executive of Shelter, told the Observer, “The private rental sector is creaking under the weight of demand as rents spiral out of reach of local incomes and tenants are pitted against each other for a limited supply of homes.”

Landlords in less affluent areas rely more heavily on mortgage finance than their wealthier peers, according to Hamptons, helping to drive up costs. Interest rates have gone up from 1.75% in August 2022 to 5.25% today, with some passing on rising costs to renters. Tenants in deprived districts have seen monthly rents increase by a typical £97 since 2022.

“Over the past couple of years, more people have wanted to live in cities, where areas of high deprivation are concentrated,” said Wilson Craw, adding, “Financial pressures have pushed many renters into relatively cheaper areas of cities to find an affordable home, and the effect has been to push up rents for those people already living there”.

The figures reflect how Britain’s continuing housing crisis is combining with the cost of living crisis as rent, mortgage rates and rising food and energy costs squeeze incomes.

Renters are already more likely to be living in poverty. According to the 2022 annual poverty report from the Joseph Rowntree Foundation, a third of private tenants (4.2 million people) are in poverty, driven by a combination of high housing costs and low incomes. Almost a half (46%) of private renters living in poverty say they have been pulled into it by their housing costs.

Of the most deprived regions in the UK, the district with the highest percentage rise in rental costs was Linthouse, Glasgow, where monthly rents increased from £597 in 2019 to £985 this year – a rise of 65%. Just under a third (30%) of children in Glasgow city live in poverty.

For tenants in affluent Ascot in Berkshire, rents are higher than in Linthouse but the percentage increase is far lower. Monthly rents rose from £3,224 in 2019 to £4,163 in 2023 – an increase of 29%. Child poverty rates in the wider Windsor and Maidenhead region are 19%, and more than two-thirds of Ascot residents own their own homes.

Low incomes and high costs are also adding to problem debt. Joseph Rowntree Foundation data found 20% of low-income households taking on new debt to pay for rent and energy.

Esther Planas, 62, has called Hackney, in East London, home since the late 1990s, when she moved to the UK from Spain. An artist, she has lived and worked in the borough ever since, admitting that in some ways she was “part of the gentrification”.

Planas is now faced with having to leave her home due to increasingly high housing costs. Her landlord recently informed her that her monthly rent will go up from £1,1175 to £1,620 – an increase she cannot afford.

“It’s a huge amount of money,” she told the Observer, adding, “I live in a vulnerable and precarious context as an artist. My income is from selling my work, teaching, lecturing, and grants. I considered becoming officially homeless and getting help from the council, but the waiting list is years long.”

This is not the first time rising rents have forced Planas from her home. Her previous landlord evicted all the residents from the block of studios where she used to live. Now the street is full of “VIP apartments”.

The stress of losing her home, and the struggle to find a new place to live, is affecting her mental health.

“I feel anxious, I have trouble sleeping. Everywhere I look is £1,300 or £1,400 a month, but mostly, £1,500, £1,600, or £1,700, even outside Hackney. It is impossible,” she said, adding, “It’s brutal. We need regulation. We need something to change.”