Graduates in London are spending upwards of half of their monthly wage on rental payments, the latest Landbay Rental Index has shown.
The index, powered by MIAC, has suggested that graduates who wish to live alone in the capital, face spending 73% of their post-tax income on rent.
In a shared house of two people, overall rent equates to 49% of each tenant’s income, whilst those co-habiting in a three-bed property would each spend 45% of their monthly take home pay on rent.
John Goodall, chief executive and founder of Landbay, said: “Faced with record high student debt levels and the rising cost of living, it will be little surprise to see graduates starting to look elsewhere from the traditional young professional hot spots such as Fulham and Camden when they come to London.
“There are of course a number of factors at play, but as returns fall in the more central locations, landlords may look to the outer boroughs to seek more attractive yields.”
Of the London boroughs, the most affordable average residential rents of properties are found in Bexley, Sutton and Havering, however Lewisham is the most affordable borough close to the city centre with average rental prices of 1,232.
Unsurprisingly, the most expensive average rents are found in Kensington & Chelsea, where the average rent is £3,042.