Cost of living declines for renters in London

7 September 2020 | General

Renters living in London have enjoyed one of the most significant increases in ‘livability’ in terms of cost of renting and living, according to the latest research by rental marketplace Spotahome.

Using data on the basic costs of living across 27 European capitals, Spotahome calculated what percentage of the average net monthly salary this total cost of living accounted for in each city and how this has changed in the past three years. The research revealed that Warsaw, Lisbon and Budapest saw the highest costs of living at present, with total costs accounting for between 92 and 96% of the average monthly income.

Helsinki however is one of the most affordable cities for renters, with the essential cost of living accounting for just 47% of the average monthly wage. Over three quarters (76%) of the average monthly wage is required in London to cover the necessary costs of living, however the capital has seen the second-largest decline over the past three years due to positive wage growth. In 2017, 89% of the average monthly wage was required to cover the basic cost of living. Vilnius, the capital of Lithuania, is the only city to have seen a more considerable decline, as the cost of living now accounts for 76% of the monthly wage, down from 94% in 2017.

Nadia Butt, UK and Ireland country manager of Spotahome, said: “We tend to see a lot of focus on the high cost of living in many major European cities which is driven mainly by the price of securing a rental property.

“However, the good news is that across many cities, the level of earnings required to cover this cost of living has actually declined over the last three years.

“This is primarily a result of consistent wage growth outstripping the increase in the cost of day to day outgoings and demonstrates why many are still keen to travel to foreign countries to further their professional careers.

Not only can they earn more, but spending less of their monthly income on getting by means they have a much better chance of saving for future investments such as buying a house of their own.”

This post has originally been featured in Property Wire.