Salary rises in the UK will overtake rent increases this year for the first time since 2009.
As a result, the squeeze on disposable income for householders should lessen after five long years.
In what was a challenging year, rent hikes in 2012 outran wages twice.
But now average earnings are due to grow by 2.2% while rent is likely to rise by 1.7%, according to a study by LSL Property Services. Monthly rents are forecast to peak at 38.3% of average gross earnings in July.
“This year the squeeze on living standards is finally abating. Households have withstood half a decade of bombardment from weak earnings, inflation and a general spectre of gloom. We’re still some way from the finish line but for now things can only get better,” said David Newnes, director of estate agents Your Move and Reed Rains, owned by LSL Property.
The number of people in two months’ arrears with their rent is 35% lower than this time last year.
Despite rents having been pushed very high, the changes in the property market over more than a decade have created more tenants than buyers.
Since 2001, in the under 35 age bracket, there has been a 41% drop in home buyers. For those between 35 and 44 years, a fall of 17% has occurred.
