The latest research from leading room share platform, ideal flatmate, has looked at an alternative way to save that all important mortgage deposit while renting in the capital without compromising your rental locations, social life or calorie intake.
ideal flatmate looked at how much the average tenant could save in each borough by opting for a single room instead of renting a one-bedroom apartment of their own, based on the average cost of each across the capital.
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ideal flatmate then looked at the required mortgage deposit at 10% of the average first-time buyer house price in each borough, before working out how many years it would take with the savings from house to flat sharing to reach this deposit.
Across London the average cost of a one-bedroom property is ยฃ1,300 a month, while a room will set you back just ยฃ600,ย a saving of ยฃ700 a month. This equates to ยฃ8,400 a month and with the average first-time buyer house price in London currently at ยฃ412,679, it would take just under five-years (4.9) to save the ยฃ41,267 10% mortgage deposit required.
The best borough for this alternative foot on the ladder was Hounslow. The average one-bed apartment costs ยฃ1,300 to rent, with a room costing just ยฃ596 to ยฃ704 cheaper a month or ยฃ8,448 a year. With this saving, it would take a tenant in Hounslow just over 4.2-years to compile the required deposit of ยฃ35,308
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Enfield, Ealing, Tower Hamlets and Newham all provided a large enough saving to ensure tenants could save a mortgage deposit to live in the borough in less than five years.
At the other end of the table it would take tenants in Kensington and Chelsea 10.4-years to save a deposit with their room rental savings as a result of the extreme property prices in the borough.
But perhaps more surprisingly, it would also take tenants in Bexley the same amount of time for the opposite reason. The cost of renting a one bedroom and a room in the borough are both very reasonable so the saving is small, meaning it would take the same time to stump up the ยฃ31,000 deposit required in Bexley, as it would for the ยฃ120,716 deposit in Kensington and Chelsea.
Co-founder of ideal flatmate, Tom Gatzen said, โThe financial barrier of transitioning from a tenant to a homeowner in London is huge and when coupled with a lack of suitable rental stock available, itโs currently one of the biggest factors putting a strain on the capitalโs rental market.
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“We completely understand that for many, the only viable option when living in the capital is to rent a room in a house or flat share already and thereโs a very good chance that house prices in London will be higher than they are now in four to five yearsโ time.
“However, while we know the idea of saving for a mortgage deposit seems impossible, we wanted to get people thinking outside the box on ways they can make a lifestyle adjustment in order to start tackling this mammoth task, without compromising the area in which they live or having to forsake avocado for breakfast.โ
Borough | Average Rent (1 bed) | Single Room Rent | Monthly Saving | Yearly Saving | FTB House Price | Mortgage Deposit Required @ 10% | Years of Saving Required |
Hounslow | ยฃ1,300 | ยฃ596 | ยฃ704 | ยฃ8,448 | ยฃ353,076 | ยฃ35,308 | 4.2 |
Enfield | ยฃ1,100 | ยฃ442 | ยฃ658 | ยฃ7,896 | ยฃ352,056 | ยฃ35,206 | 4.5 |
Ealing | ยฃ1,200 | ยฃ442 | ยฃ758 | ยฃ9,096 | ยฃ426,620 | ยฃ42,662 | 4.7 |
Tower Hamlets | ยฃ1,430 | ยฃ693 | ยฃ737 | ยฃ8,844 | ยฃ415,189 | ยฃ41,519 | 4.7 |
Newham | ยฃ1,200 | ยฃ592 | ยฃ608 | ยฃ7,296 | ยฃ342,734 | ยฃ34,273 | 4.7 |
Brent | ยฃ1,250 | ยฃ592 | ยฃ658 | ยฃ7,896 | ยฃ406,390 | ยฃ40,639 | 5.1 |
Southwark | ยฃ1,300 | ยฃ588 | ยฃ712 | ยฃ8,544 | ยฃ446,372 | ยฃ44,637 | 5.2 |
Hackney | ยฃ1,495 | ยฃ667 | ยฃ828 | ยฃ9,936 | ยฃ523,280 | ยฃ52,328 | 5.3 |
Lambeth | ยฃ1,300 | ยฃ596 | ยฃ704 | ยฃ8,448 | ยฃ453,022 | ยฃ45,302 | 5.4 |
Lewisham | ยฃ1,100 | ยฃ550 | ยฃ550 | ยฃ6,600 | ยฃ366,680 | ยฃ36,668 | 5.6 |
Kingston | ยฃ1,100 | ยฃ492 | ยฃ608 | ยฃ7,296 | ยฃ409,397 | ยฃ40,940 | 5.6 |
Haringey | ยฃ1,250 | ยฃ567 | ยฃ683 | ยฃ8,196 | ยฃ478,903 | ยฃ47,890 | 5.8 |
Greenwich | ยฃ1,150 | ยฃ650 | ยฃ500 | ยฃ6,000 | ยฃ352,939 | ยฃ35,294 | 5.9 |
Islington | ยฃ1,517 | ยฃ701 | ยฃ816 | ยฃ9,792 | ยฃ582,156 | ยฃ58,216 | 5.9 |
Redbridge | ยฃ990 | ยฃ476 | ยฃ514 | ยฃ6,168 | ยฃ370,373 | ยฃ37,037 | 6.0 |
Croydon | ยฃ900 | ยฃ492 | ยฃ408 | ยฃ4,896 | ยฃ302,758 | ยฃ30,276 | 6.2 |
Barnet | ยฃ1,150 | ยฃ548 | ยฃ602 | ยฃ7,224 | ยฃ446,786 | ยฃ44,679 | 6.2 |
Hillingdon | ยฃ1,000 | ยฃ542 | ยฃ458 | ยฃ5,496 | ยฃ341,413 | ยฃ34,141 | 6.2 |
Harrow | ยฃ1,050 | ยฃ539 | ยฃ511 | ยฃ6,132 | ยฃ386,293 | ยฃ38,629 | 6.3 |
Waltham Forest | ยฃ1,075 | ยฃ523 | ยฃ552 | ยฃ6,624 | ยฃ419,083 | ยฃ41,908 | 6.3 |
Westminster | ยฃ1,842 | ยฃ715 | ยฃ1,127 | ยฃ13,524 | ยฃ895,636 | ยฃ89,564 | 6.6 |
Wandsworth | ยฃ1,365 | ยฃ713 | ยฃ652 | ยฃ7,824 | ยฃ521,095 | ยฃ52,110 | 6.7 |
Merton | ยฃ1,200 | ยฃ642 | ยฃ558 | ยฃ6,696 | ยฃ447,387 | ยฃ44,739 | 6.7 |
Barking and Dagenham | ยฃ950 | ยฃ592 | ยฃ358 | ยฃ4,296 | ยฃ287,108 | ยฃ28,711 | 6.7 |
Bromley | ยฃ950 | ยฃ527 | ยฃ423 | ยฃ5,076 | ยฃ353,448 | ยฃ35,345 | 7.0 |
Sutton | ยฃ925 | ยฃ550 | ยฃ375 | ยฃ4,500 | ยฃ320,221 | ยฃ32,022 | 7.1 |
Richmond | ยฃ1,200 | ยฃ614 | ยฃ586 | ยฃ7,032 | ยฃ528,510 | ยฃ52,851 | 7.5 |
Camden | ยฃ1,582 | ยฃ802 | ยฃ780 | ยฃ9,360 | ยฃ706,879 | ยฃ70,688 | 7.6 |
Havering | ยฃ875 | ยฃ549 | ยฃ326 | ยฃ3,912 | ยฃ312,903 | ยฃ31,290 | 8.0 |
Hammersmith and Fulham | ยฃ1,400 | ยฃ801 | ยฃ599 | ยฃ7,188 | ยฃ641,542 | ยฃ64,154 | 8.9 |
Bexley | ยฃ800 | ยฃ550 | ยฃ250 | ยฃ3,000 | ยฃ310,631 | ยฃ31,063 | 10.4 |
Kensington and Chelsea | ยฃ1,950 | ยฃ980 | ยฃ970 | ยฃ11,640 | ยฃ1,207,159 | ยฃ120,716 | 10.4 |
London | ยฃ1,300 | ยฃ600 | ยฃ700 | ยฃ8,400 | ยฃ412,679 | ยฃ41,268 | 4.9 |
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