Millennials are now spending a large portion of their monthly budgets on their rent. New research has found that Millennials (the 22 to 37 age group), are spending more than ever on their rents, but that a lot of this is down to personal choice and the desire to live in better locations.
Millennials Spending up to 41% of Income on Rent
Home Made, a letting agent in London, carried out an analysis of the rental market, as reported here. It analysed trends on renting properties over the last 12 months for Millennials, and it found that in London, Millennials spend up to 41% of net income on their rent.
This is a large amount of rent, but when you consider that it was just 32.5% in 2005, it’s a considerable increase.
New Builds Are Popular with Millennials
This is partly due to rental prices in the capital going up faster than pay. However, Home Made also found some other stats that shed some light on Millennial renting trends.
For example, for new-build apartments in London, 82% of renters are Millennials. This suggests that they are more willing to pay higher prices for new apartments that offer a combination of high-quality and a community lifestyle.
Also, many Millennials want to live in inner London. Of rental enquiries from people in outer London, 57% were for properties in inner London. This suggests that Millennials are looking for shorter commute times and all the amenities in the inner city, and they are willing to pay more for it.
The CEO of Home Made, Asaf Navot, said that the research shows the “changing renting patterns” and how younger people are willing to pay more for the right location and being in the right community.
Save Money on Your Rent
Are you a Millennial spending a large portion of your income on rent? There are ways that you can save money so you don’t spend such a large amount of your net income.
One of the easiest ways to save is to choose a more affordable location. As the research shows, many Millennials are willing to pay more to live in the most desirable locations. But if you don’t mind where you live, you can easily save a lot of money by choosing to live somewhere more affordable.
Also, always look around when you are renting a property and get a feel for the market in your chosen area. Don’t just go for the first property you find that looks like a good fit. Compare various properties, and you may find that significant savings can be made.