00:00 London rents are up 31% in two years, but how much higher can they go?
00:06 Rent now takes up 42.5% of people's income, and in general, housing costs can only take up 30% of a person's income to be deemed affordable.
00:16 Savills says renters have already exhausted their capacity to bid upwards,
00:21 and as a result, they predict that while rents will continue to rise for the next few years, they will probably do at a slower pace than the rest of the UK.
00:30 Here's what Savills predicts.
00:32 London rents could go up by another 5.5% in 2024.
00:37 By 2028, rent in the capital will be another 18.2% higher.
00:43 In many London postcodes, a room alone now costs £1,000 a month, with tenants reporting their struggles with sudden rent increases.
00:52 However, investors will likely replace private landlords.
00:56 Savills said it was difficult to see where an increase in rental stock could come from,
01:01 but predicted that the rental crisis will lead to more institutional landlords entering the market to fill the gap left by private landlords.
01:10 Companies such as banks and investment funds will invest in flats and rent it out for profit for their investors.
01:17 Savills has previously reported that London would need 90,000 more homes a year to have an impact on housing affordability.
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