Inflation, as calculated by the Government's Consumer Prices Index, rose by 0.3% over the last 12 months. The question is: what does this mean for tenants living north of London?
Back in November, the Office of National Statistics stated average wages only rose by 1.8% year on year, so when adjusted for inflation, people are 1.5% better off in 'real' terms. But how does this shape up for tenants who are paying rent?
As you can see, the regions north of London show that tenants are in the most secure rental properties in the UK given that their rent increases often equate to less than the 1.5% 'real terms' increase in wealth they experience through inflation and salary increases.
It is worth noting that the East and West Midlands have rents that increased beyond that rate, as experienced everywhere south of London (the East had a 3.0% rent increase, for example).
Today we are seeing a slow reversion back towards to a tenant majority in the UK. The question is, will the percentage of tenants in the North go up in the coming years, or down?
The figures suggest that rents are growing but, critically, not as much as incomes, leaving some degree of choice for prospective buyers. For now, the sustainable option is to remain a tenant - you save yourself the stress of saving and buying, you get to keep that extra wage increase for yourself, and there are no guarantees that you will be better off in the long run if you do end up buying.
Expect the proportion of renters in the North to go in one direction in the coming years: up.