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RENT hikes are far outstripping wage growth and general inflation, official figures showed today.
The Office for National Statistics reported that average rents rose by 8.7 per cent in the year to January.
This is more than double retail prices index (RPI) inflation, which the statistics body revealed had jumped to 3.2 per cent in December.
Rental increases are also far higher than the latest 5.6 per cent wage growth figures.
More than one in three private renters are in poverty after housing costs, the Joseph Rowntree Foundation has warned.
New lets are £270 per month higher than three years ago, according to Zoopla.
“Everyone needs a safe, secure and affordable home, said Generation Rent deputy chief executive Dan Wilson Craw, “but renters across the UK are facing soaring rents which are far outstripping our earnings.
“When we are forced to spend too much of our income on rent, the effects ripple across the rest of our lives.
“It means children are going to school hungry, and older renters can’t afford to turn the heating on. High rents are trapping people in poverty.
“It’s encouraging to see the Scottish government proposing to introduce rent caps,” he added. “We now need to see a similar approach across the rest of the UK to urgently slam the brakes on rising rents and give people the breathing space we need.”
Plane fares, rising food costs and a sharp jump in private school fees contributed to the rise in RPI inflation.
The latest reading — 3 per cent using the consumer prices index — was higher than the 2.8 per cent predicted by analysts.
As a result, economists have predicted a slowdown in the Bank of England’s cutting of interest rates from the current 4.5 per cent.
TUC general secretary Paul Nowak said: “The rise in inflation is mainly being driven by a sharp rebound in volatile air fares as well as by external factors or administered and regulated prices, like fuel, food and private school fees. It is not being driven by pay.
“As the Bank of England has rightly recognised, the biggest threat to our economy is low growth. That’s why they cut interest rates at the start of this month.
“The bank must balance the pressure on households from rising prices with the urgent need to boost growth. Further interest rates cuts remain the right call.”
