Typical deposit will rise to be equivalent of six weeks' rent - forecast

Typical deposit will rise to be equivalent of six weeks' rent - forecast

In 2026 - just 10 years from now - the average UK private rental deposit is set to reach £1,111 - the equivalent of 70 per cent of the average Briton’s monthly income.

The prediction comes from comparison website Money.co.uk which says that in London the position will be much worse for renters: deposits in the capital are projected to rise to £2,733, sucking up 120 per cent of one month’s average salary. 

The website has commissioned CEBR, the Centre for Economics and Business Research, to investigate trends in the private rental sector and to extrapolate current deposit figure. CEBR calculates that by 2026 the majority of landlords will require six week’s rent as a deposit - rather than the currently-common 68 per cent - because of the additional running costs involved in being a buy to let owner.

CEBR paints a stark picture in terms of costs for tenants. 

By 2026 some 7.2m households in England and Wales are estimated to be privately rented; this is around two thirds more than now. By 2026 private renters are projected to represent 30 per cent of all households.

By 2026, average monthly rents are set to rise by 28 per cent; by contrast salaries are likely to rise by 20 per cent.

Article courtesy of Letting Agent Today | Sign up for Letting Agent Today newsletter | Get this news on YOUR site!