Private renters spend a third of their wages on housing

People living in private rented homes in England are spending a growing chunk of their income on housing.

According to the government’s English Housing Survey, private renters spent more than a third (34%) of their wages on rent in 2023-24.

That’s up from 32% in 2019-20, and well above the share spent by social renters (26%) and people with a mortgage (19%).

Private renters were also found to be the most likely to struggle to afford their housing costs, with nearly one in three (32%) saying they find it hard.

By contrast, just 28% of social renters and 14% of people who own a property said the same.

Private renters have lower savings than property owners

Perhaps as a result of how much they’re spending on housing, tenants typically have less in savings than people who own their home.

The English Housing Survey showed that just 52% of private renters have savings, compared with 79% of owner occupiers.

But social renters lagged well behind, with just 28% having savings.

This pattern was reflected in the amount of money people had saved.

Figures showed that 33% of owner occupiers have at least £50,000 in savings, 32% of private renters have between £5,000 and £15,999 and 34% of social renters have between £1,000 and £4,999.

Renters still hopeful of buying a house

Despite tenants paying a bigger chunk of their income on housing than they were a few years ago, many are still hopeful of getting on the property ladder.

Figures showed that 2.6 million private renters expect to buy a home in the future.

That compares with less than one million social renters.

Interestingly, younger private and social renters were found to be more likely to expect to buy than older renters.

Nearly three-quarters (72%) of renters aged 16 to 24 expect to get on the property ladder, including a third (32%) of male renters who currently live alone.