"What our research clearly shows is that the situation is starting to move in the right direction. Strong wage growth across the capital over the past year means that, despite high rents, affordability has actually improved in many parts of the city"
- Marc von Grundherr - Benham and Reeves
Rising wages in London are helping renters spend a smaller proportion of their income on housing.
New analysis from Benham and Reeves shows that the average London renter now spends 49.5% of their monthly income on rent. Average earnings in the capital stand at £4,586, while the typical monthly rent is £2,268. This marks a slight improvement since 2024, when renters were paying around 50% of their income on rent.
Affordability varies widely across boroughs. Renters in Hackney face the highest proportion of income spent on rent at 60.6%, with average earnings of £4,253 and rents of £2,578. Haringey follows at 58.7%, Barking & Dagenham 56.8%, Ealing 54.6%, Hounslow 53.3%, Brent 53.1%, Newham 52.1%, Southwark 50.3%, Enfield 49.8%, and Lambeth 48.1%.
Several boroughs have seen more significant improvements since 2024. In Wandsworth, strong salary growth has driven a fall of 8.7% in rent as a proportion of income. Camden follows with a 7.9% improvement due to falling rents, while Harrow (-7.9%), Hammersmith & Fulham (-7.8%), and Tower Hamlets (-5.6%) also recorded notable reductions.
However, some areas have become less affordable over the same period. Renters in Ealing now spend 3.4% more of their income on rent, Haringey 3.3%, Bexley 2.8%, Richmond-upon-Thames 2.7%, and Enfield 2%.
“There’s no question that London remains an expensive city for renters and, for many people, the cost of housing still takes up a significant share of monthly income," comments Marc von Grundherr, director of Benham and Reeves (pictured).
He added, “However, what our research clearly shows is that the situation is starting to move in the right direction. Strong wage growth across the capital over the past year means that, despite high rents, affordability has actually improved in many parts of the city."
“While challenges remain and conditions vary by borough, rising earnings are helping to ease some of the pressure on renters and providing a more positive outlook than we saw this time last year.”
