For Generation Rent, the landlord is king

Last night, I posted an advert on property rental site SpareRoom: ‘Looking for someone to take over my room in Dalston/De Beauvoir from July. Beautiful house, large bedroom, overlooks a garden centre.’ By this morning, I had almost 60 inquiries.

Bleary eyed and fuzzy from sleep, I checked my email: it was inundated with prospective tenants offering to ‘pass’ interviews over Zoom before being granted a viewing or handing over large sums of money for the deposit before even seeing the place in person. One woman had contacted me from Australia.

The overwhelming response to my advert, while a plus for me, is a symptom of the lack of housing in available in London at the moment – especially for members of Generation Rent (millennials who have been priced out of the buyers’ market). In March, there were reportedly almost 44 per cent fewer rooms to rent in the capital than last year. This is thought to have been caused by a combination of buy-to-let landlords selling up and people moving back in with family during the pandemic. The influx of renters back into cities marks a dramatic U-turn from the beginning of the pandemic, which saw renters heading to the country in droves.

Millennials are used to a nomadic existence. Analysis from March found that a quarter of millennials had moved house ten or more times since leaving home; a further quarter expect to move another five times before finding a permanent place. In comparison, the over-50s are likely to have lived in fewer than five houses in their lifetime. And 44 per cent of this age group have never lived with someone that isn’t part of their immediate family.

For Generation Rent, the landlord is king. This imbalance of power means tenants are often in a precarious position, scrabbling for spaces in cramped, scruffy properties while spending too much of their salaries on rent to be able to save effectively for a place of their own. One renter I know told me that, when her flat flooded with rainwater after a particularly heavy storm, neither her housing manager or her lettings agency would do anything about it – despite the beds being soaked through and the power intermittently shutting off. The building management company’s response? ‘It doesn’t look like it’s going to rain any more this evening.’ Her landlord lived abroad, and the repairs were only fully completed last week – eight months after the damage was originally done.

Despite stories like this, Matt Hutchinson, director of communications at SpareRoom said he was expecting to see rents in London – and across the rest of the country – hit ‘record highs by the end of this year’. He added: ‘The simple fact is that people are renting for longer today than they used to and the key reason is affordability. The days of average house prices being roughly three or four times the average salary are long gone. That means Gen Z and millennials will live in so many more properties, and with so many more people, than their parents did.’

Figures from the Office for National Statistics, released this week, show that while rents have continued to increase this year compared with last, a rise of 1.1 per cent in London last month means prices have fallen in real terms in the city. Outside the capital, rent prices grew by 2.5 per cent in England, 1.7 per cent in Wales, and 2.9 per cent in Scotland in the 12 months to April. Equally, the property rental figure alone doesn’t consider the rising cost of living and the huge spike in energy prices – or the difference in between leasing a whole property and a landlord choosing a higher price when renting out a single bedroom (the average bedroom in a shared London flat cost £794 per month in Q1 of this year). Inflation has hit 9 per cent for the first time in 40 years. Wages are also falling in real terms. It’s a bleak picture for those who remain at the mercy of their landlords choosing to raise the rent or not.