Recently released figures from credit reference agency Experian highlight how tenants are cutting back or even abandoning their leisure and social activities to pay the rent.

Many renters in the UK pay more than half of their income in rent which leaves little in the pot for other activities. Tenants who are under 30 years old are being hardest hit with those in London, where rents are one and a half times the national average, are particularly affected.

War waged on rising rents

This trend has been created largely by rent rises outstripping pay packet inflation during the past decade. A recent survey* revealed that in London 45% of tenants said they had struggled to pay a rent increase at one point or another. Rents increased across Britain by 2% during 2016/17, government figures show, while wages increased by just 0.2% and inflation by 1.2%*.

What's going on?

A higher demand for rental accommodation, fuelled by the difficulties of getting a mortgage, fewer first time buyers and more families looking to rent, has increased demand - while recent tax changes for landlords has reduced supply, it is claimed. Insurance firm AXA recently revealed that half of all landlords could quite the sector in the coming years as the tax breaks are withdrawn.

What can you do?

To regain some control of their finances many renters are being forced to move. They either find a smaller or lower-priced property and compromise on location or, in some cases, are even having to move back home with their parents as a stop-gap measure.

Other ways in which tenants are coping with higher rents is to sub-let or take in lodgers (when their lease permits this).

Long term solution

There is a one-size-fits all solution to all these problems. And that is for tenants to buy a property instead. This can sound like a glib response to the problem, given how difficult it can be to get on the property ladder at the moment. But that's where Credit Ladder can help

Getting a mortgage

To obtain a mortgage you must have a good credit history and credit score. You should check your credit file as quickly as possible.

You should also begin to increase your credit score and, if you haven’t already done so, register with Credit Ladder. It is one of the most effective ways to increase your credit score without taking on extra credit or extra fees.

Click here for more information on how Credit Ladder can help you make the transition from renter to homeowner and free up some of your hard earned cash to resume those leisure activities you sacrificed when you were renting.

Sources:

* What Are London's Renters Thinking? October 2016. Sian Berry, Green Party Member of the London Assembly.

https://www.london.gov.uk/sites/default/files/sian...

https://www.ons.gov.uk/employmentandlabourmarket/p...

Remember, CreditLadder can help you improve your credit score.

CreditLadder can improve your credit position by reporting your rent payments. CreditLadder is the first way to improve your credit score and position across all three of the main Credit Reference Agencies in the UK, namely Experian, Equifax and TransUnion. Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this can also help save you money. CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.

Remember the content provided in this article is for information purposes only and should not be considered as advice.