Rental deposit costs dwarfed by increase in TV, mobile contracts and Big Macs
The latest research by lettings deposit
replacement scheme, Ome, has revealed how much we are paying to secure a rental
property and how this has changed in the last five years, as well as how this
price increase compares to other items throughout our daily lives.
Ome’s data shows that the current tenant is now
paying £1,139, a 5% increase compared to the £1,088 paid in 2014. Renting is
thought to be one of life’s largest financial hurdles, with the traditional
upfront deposit charged at the start of a tenancy, in particular, posing an
obstacle to the nation’s tenants.
However, when looking at the cost of a deposit
compared to the inflation of other everyday costs, the figures show that
deposits have increased at a lower rate than many other costs of living,
suggesting the issues of cash flow surrounding renting stretch further than the
deposit itself.
The cost of a basic pay TV package, such as Sky
or Virgin, has increased from an average of £22 to £28 in the last five years,
the largest increase at 26%.
While the cost of renting has increased, it’s
the cost of buying a home that has seen the second largest increase in the last
five years, up 24% to the current average house price of £231,265.
The sum we spend on our mobile phones has seen
the third largest increase, up 22%, while the price of a Big Mac has also
increased more than the average rental deposit (+19%).
Other items that have increased at a greater
rate than tenancy deposits in the last five years are car insurance (15.3%),
the price of gold (10%), the cost of a pint (10%) and the cost of a cinema
ticket (6%).
In fact, the only things to make the list that
have increased at a lower rate than a rental deposit are home insurance costs
(4%) and petrol (-2%). During this time, the average UK salary has only
increased by 12.4%, meaning many day to day items have grown at a larger rate,
although again, rental deposit are not one of these.
Co-founder of Ome, Matthew Hooker,
commented:
“The rental sector has received a fair share of
negative press in its time and much of this has been focussed around the
traditional deposit and the sums charged by agents at the start of a tenancy in
order for a tenant to secure a property.
However, with the recent Tenant Fee Act shining
a light on the fees charged by traditional letting agents, it’s interesting to
see that in relative terms, the increase in the value of tenant deposits is
actually smaller than the increase seen in our TV packages, mobile contracts,
Big Macs, and even the growth in the average UK salary.
So it would seem that it is the cost of living
within a property itself that is putting the greatest financial squeeze on the
nation’s tenants, with the actual deposit only proving a problem for those
unable to accumulate the large initial sum, or finding themselves short for
other areas of life once they have.
Of course, many of these other costs are either
small or provide the option to pay in installments with the deposit being the
last major cost that can’t be widely tackled in bite sized chunks. That’s why
we’ve seen a number of deposit alternatives enter the market in order to
provide this choice and allow tenants to stay on top of the climbing costs
elsewhere in life, by opting to pay their rental deposit on a more manageable
monthly basis.”
Variable | Five year change (2014 – 2019) |
Basic pay-TV price (monthly) | 26% |
Average house price | 24% |
Mobile usage price (monthly) | 22% |
Big Mac | 19% |
Car insurance premium (annual) | 15% |
UK Net Salary | 12% |
Gold | 10% |
Pint of beer | 10% |
Cinema ticket | 6% |
Tenancy deposit | 5% |
Home insurance premium (annual) | 4% |
Unleaded petrol (pump price) | -2% |
Sources | ||
Rental Deposits | Ome | source1 – Ome unique data |
TDS |
source2 – TDS statistics |
|
Car insurance | Money supermarket |
source3 – car insurance |
Home insurance | Money supermarket |
source4 – home insurance |
Mobile phone & TV costs | Ofcom |
source5 – communications pricing statistics |
Average house price | Gov/Land Reg |
source6 – Ave House Price |
Gold historical prices | Bullion by post |
source7 – gold historical prices |
Cinema ticket statistics | Statista |
source8 – cinema ticket prices |
Petrol prices | RAC |
source9 – petrol historical prices |
Price of a pint of beer | ONS |
source10 – ONS inflation statistics |
Big Mac price statistics | FM |
source11 – Big Mac historical prices |
BL |
source12 – Big Mac current prices |
|
Average salary data | ONS |
source13- Average salary data |
©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Rental deposit costs dwarfed by increase in TV, mobile contracts and Big Macs | LandlordZONE.
View Full Article: Rental deposit costs dwarfed by increase in TV, mobile contracts and Big Macs
Post comment
Categories
- Landlords (19)
- Real Estate (9)
- Renewables & Green Issues (1)
- Rental Property Investment (1)
- Tenants (21)
- Uncategorized (11,917)
Archives
- December 2024 (44)
- November 2024 (64)
- October 2024 (82)
- September 2024 (69)
- August 2024 (55)
- July 2024 (64)
- June 2024 (54)
- May 2024 (73)
- April 2024 (59)
- March 2024 (49)
- February 2024 (57)
- January 2024 (58)
- December 2023 (56)
- November 2023 (59)
- October 2023 (67)
- September 2023 (136)
- August 2023 (131)
- July 2023 (129)
- June 2023 (128)
- May 2023 (140)
- April 2023 (121)
- March 2023 (168)
- February 2023 (155)
- January 2023 (152)
- December 2022 (136)
- November 2022 (158)
- October 2022 (146)
- September 2022 (148)
- August 2022 (169)
- July 2022 (124)
- June 2022 (124)
- May 2022 (130)
- April 2022 (116)
- March 2022 (155)
- February 2022 (124)
- January 2022 (120)
- December 2021 (117)
- November 2021 (139)
- October 2021 (130)
- September 2021 (138)
- August 2021 (110)
- July 2021 (110)
- June 2021 (60)
- May 2021 (127)
- April 2021 (122)
- March 2021 (156)
- February 2021 (154)
- January 2021 (133)
- December 2020 (126)
- November 2020 (159)
- October 2020 (169)
- September 2020 (181)
- August 2020 (147)
- July 2020 (172)
- June 2020 (158)
- May 2020 (177)
- April 2020 (188)
- March 2020 (234)
- February 2020 (212)
- January 2020 (164)
- December 2019 (107)
- November 2019 (131)
- October 2019 (145)
- September 2019 (123)
- August 2019 (112)
- July 2019 (93)
- June 2019 (82)
- May 2019 (94)
- April 2019 (88)
- March 2019 (78)
- February 2019 (77)
- January 2019 (71)
- December 2018 (37)
- November 2018 (85)
- October 2018 (108)
- September 2018 (110)
- August 2018 (135)
- July 2018 (140)
- June 2018 (118)
- May 2018 (113)
- April 2018 (64)
- March 2018 (96)
- February 2018 (82)
- January 2018 (92)
- December 2017 (62)
- November 2017 (100)
- October 2017 (105)
- September 2017 (97)
- August 2017 (101)
- July 2017 (104)
- June 2017 (155)
- May 2017 (135)
- April 2017 (113)
- March 2017 (138)
- February 2017 (150)
- January 2017 (127)
- December 2016 (90)
- November 2016 (135)
- October 2016 (149)
- September 2016 (135)
- August 2016 (48)
- July 2016 (52)
- June 2016 (54)
- May 2016 (52)
- April 2016 (24)
- October 2014 (8)
- April 2012 (2)
- December 2011 (2)
- November 2011 (10)
- October 2011 (9)
- September 2011 (9)
- August 2011 (3)
Calendar
Recent Posts
- Landlords could pay tenants up to two years’ rent for failing Decent Homes Standard as PBSA is exempt
- Landlords’ Rights Bill: Let’s tell the government what we want
- 2025 will be crucial for leasehold reform as secondary legislation takes shape
- Reeves inflationary budget puts mockers on Bank Base Rate reduction
- How to Avoid SDLT Hikes In 2025