Renting costs put home ownership out of reach for many tenants
A new report found three quarters of renters say the combined costs of rent, agency fees and moving make buying a home harder.
The findings from charity Citizens Advice hold true across the income scale.
More than three quarters (78%) of people from households earning £50,000 – the top 25% of household earners – report that renting costs make buying a home harder.
A first-time buyer in the UK will need an average deposit of over £30,000, while the annual cost of renting a home outside of London is over £7,600 and over £15,000 in the capital.
A YouGov survey of over 2,000 private renters in England shows how letting agent fees also contribute to the overall cost of renting.
Of households earning £50,000 or more, two thirds (69%) paid fees to their current letting agent with some paying more than £1000:
- 1 in 5 (20%) have to spend between £250 and £499
- 1 in 5 (19%) pay between £500 and £999
- Nearly 1 in 10 (9%) are spending £1000 or more
Citizens Advice estimates that private tenants in England spend in excess of £13m on letting agent fees each month. The charity welcomes the government’s plan to ban them – confirmed earlier this month in the housing white paper.
Gillian Guy, Chief Executive of Citizens Advice, said:“Owning a home is a pipedream for many due to the cost of renting privately.
“Households can find their efforts to save for a home of their own are undercut by the costs of renting. Now that people are staying in the private rented sector for longer the government’s commitment to ban letting agents fees could help them to save thousands of pounds towards a deposit.
“The government also needs to look at how it can do more to help private tenants at the mercy of landlords and letting agents who are slow to carry out repairs, or rent out homes that fail to meet basic standards.”