There has been a steady increase in the percentage of rental properties available over the past 12 months and data for the final quarter of last year shows that 40% of the housing stock is rental, increasing to 50% in cities such as Newcastle Upon Tyne and Manchester, new figure show.
The latest TwentyCi Property & Homemover Report for Q4 2018, which it claims is the most comprehensive real time review of the UK housing market, has confirmed an overall market slowdown in 2018.
Despite a 4% rise in new instructions year-on-year, there was a 1.2% drop in exchanges with 20% of property sales falling through, which may explain why rental stock has increased.
Overall, the data suggests that the north-south divide is very much still in existence, despite higher salaries in the south. For example, the 25% of highest earners in London will be paying between 40-60% of their take home pay on their mortgage to buy a property of equal standing with a 40% deposit.
While the 25% of lowest earners in London will not be able to afford to buy a property of equal standing as it would mean spending between 70 and 131% of their take home pay on their mortgage.
For the lowest earners, the cost of renting a property of equal standing would be between 57 to 90% of their take home pay.
But the figures show there are many places in the Midlands and north of England where the 25% of lowest earners can afford to rent or buy.
In Nottingham, for example, to rent a property of equal standing involves 35% of take-home pay on rent, or to buy might involve 37% of take-home pay on a mortgage.
Colin Bradshaw, chief customer officer, TwentyCi, said: “Q1 2019 and the outcome of the Brexit process will determine the outturn for the next 12-months.”