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Paragon’s Rental Affordability Index reveals the most affordable locations to rent in England

  • Paragon’s new Rental Affordability Index reveals Copeland is the most affordable place to rent in England, with 14% of annual salary is spent on rent
  • North West is most affordable region to rent overall, followed by North East and Yorkshire 
  • Average rental affordability ratio for the whole of England is 32.8% from an annual income of £31,200

Copeland, Allerdale and Barrow-in-Furness are the most affordable locations to privately rent in England last year, Paragon Bank analysis has revealed.

Using recently published Government data, the Rental Affordability Index compares the average percentage of annual salary spent on rental payments to reveal an average rental affordability ratio. 

On average, private rent in the three local authorities, all located within Cumbria, was less than 20% of the average salary of residents of those areas. Copeland topped the affordability list with the average annual rent of £6,101, equating to just 14% of the average annual salary for the town of £43,463. Annual rent prices in Allerdale equated to 17.8% of average salary, with Barrow-in-Furness at 19.6%.  

Other local authorities with affordable rents included North East Lincolnshire (19.6%), Carlisle (19.7%) and Bassetlaw (19.7%).  

Region 2020 income £ 2020 Rental £ Affordability ratio %
North West 29,960 7,103 23.7
North East 27,820 6,669 24.0
Yorkshire & Humber 28,680 6,972 24.3
East Midlands 29,830 7,838 26.3
West Midlands 30,020 7,921 26.4
South West 28,710 9,072 31.6
East of England 33,320 11,000 32.4
South East 32,230 12,000 36.1
London 37,830 19,000 51.3

At the other end of the scale, all of the least affordable local authorities to rent were located within London. Kensington & Chelsea topped the list, where the average rent was 98.1% of the average resident’s salary, whilst Westminster was 91.3%. Hackney (63.3%), Hammersmith & Fulham (61.1%) and Camden (61%) were the next in the least affordable list.

Across England, the average salary of £31,220 equated to 32.8% of the average rent. Regionally, the most affordable regions were all located in the north of England, with the North West coming out as the most affordable at 23.7%, followed by the North East (24%) and Yorkshire & Humber (24.3).

London (51.3%), the South East (36.1%) and East of England (32.4%) were the least affordable.

Richard Rowntree, Paragon Bank Managing Director of Mortgages, said: “These figures paint a revealing picture, with the most affordable rental locations mainly concentrated in northern areas. House prices are typically lower in these regions, meaning that rents tend to be lower. At the other end of the scale, it is not surprising to see London as home to the least affordable locations and that is why London has the highest proportion of house sharers in the UK.

“Generally, average rents have been increasing for several years and rental affordability is something landlords must be mindful of, particularly with people under more financial pressure as a result of the pandemic.”

By property type across the country, the average four-bed home equated to 56.1% of salary to rent, followed by three-bed (38.7%), two-bed (31.3%), one-bed (25.2%), studio (17.4%) and a single room (17.4%).

Top 10 most affordable areas in England

Region 2020 income £ 2020 Rental £ Affordability ratio %
Copeland 43,463 6,101 14.0
Allerdale 33,335 5,948 17.8
Barrow-in-Furness 35,139 6,890 19.6
North East Lincolnshire 28,767 5,646 19.6
Carlisle 29,223 5,750 19.7
Bassetlaw 30,273 5,978 19.7
Wigan 29,872 5,910 19.9
East Riding 31,592 6,304 20.0
Fylde 36,089 7,308 20.2
Eden 30,707 6,370 20.7

Top 10 least affordable areas in England

Region 2020 income £ 2020 Rental £ Affordability ratio %
Kensington & Chelease 46,568 45,701 98.1
Westminster 43,726 39,936 91.3
Hackney 37,585 23,782 63.3
Hammersmith & Fulham 41,262 25,200 61.1
Camden 42,528 25,928 61.0
Islington 47,120 26,174 55.5
Barnet 34,999 18,900 54.0
Lambeth 42,000 22,174 52.8
Southwark 38,266 19,746 51.6
Tower Hamlets 41,939 21,594 51.5