Renting in London is a necessity for many people and even though this may be the more prudent financial option for many people and households in the capital, this is not to say that renting is cheap or affordable. Even in an area like Streatham, which is recognised for offering value for money with respect to the property and rental market, the cost of moving here can be expensive. There are many costs associated with moving and the topic of rental deposits are hotly debated. If you are keen to move to Streatham as a tenant, how much of a deposit can you afford?
Assistance is likely to be on the way with a deposit cap being implemented but so far, there is no agreement or clarity on what the cap will be. Some of the most relevant opinions on what the deposit cap should be set at include:
- The Government is said to a six-week cap for rental deposits
- Landlord groups have publicly backed a six-week cap for rental deposits
- The Housing, Communities and Local Government Committee recommends a five-week cap for deposits
Each group has a valid point and can justify their stance, so it is not as if anyone is making an outlandish claim in this regard. However, there is a need for clarity in the rental market and there is a need to accept that many people are unable to afford the associated costs of renting.
Renting in London is expensive for many people
Rental fees are high in London, this is an accepted fact. According to the home.co.uk website, the average rent in London stands at £2,959 per calendar month, which amounts to £682.85 per week. The following figures detail how much a tenant would have to pay as a deposit going by the London average:
- A four-week cap creates an average deposit of £2,731.40
- A five-week cap creates an average deposit of £3,414.25
- A six-week cap creates an average deposit of £4,097.10
- A seven-week cap creates an average deposit of £4,779.95
However, it is not always best to take the London average as your starting point. At Oaks Estate Agents, we know that Streatham offers more affordable rental options than the London average, and the amount of money required to pay for a capped deposit in this part of the capital would be lower than the average.
Streatham is a more affordable option in the capital
From the same source, the average rent for Streatham comes in at £1,569 per calendar month, which breaks down to £362 per week. With respect to how much would be required for a capped deposit, the following table provides the outcomes:
- A four-week cap creates an average deposit of £1,448
- A five-week cap creates an average deposit of £1,810
- A six-week cap creates an average deposit of £2,172
- A seven-week cap creates an average deposit of £2,534
While these figures are considerably more affordable than the equivalent figures for the London average, it is up to each household or individual to determine what is an affordable deposit for them to pay.
Bearing in mind this deposit will often come alongside the first months’ rent, removal costs and any other fees you may have to pay, the amount of money required to move into rental accommodation very quickly adds up.
Not only does this mean that tenants need to be prepared financially before moving into rental accommodation, it is vital that they find the best possible home for their needs. There may be times when time is of the essence but given the associated costs of moving, it would be preferable if a tenant finds accommodation where they would be happy to stay for longer if given the opportunity. Not only would this offer consistency, it could lower the amount of money a tenant needs to find for a property over the long-term.
At Oaks Estate Agents, we understand the pressure that prospective tenants and landlords are under. We are keen to provide as much guidance and support as possible and if you are looking for assistance from a Streatham property specialist, we look forward to hearing from you and helping you soon.