Renting an apartment in Cambridge cost on average more than 1,500 British pounds per month in December 2023, making it the most expensive cities for renters in the UK after London. In London, the average rent ranged between 1,400 British pounds and 3,700 British pounds depending on the location. On the other hand, Northern Ireland, Wales, and North East were the regions with the most affordable rents.

The UK housing market continued to show significant regional variations in 2024, with London maintaining its position as the most expensive city for homebuyers. The average house price in the capital stood at 519,579 British pounds in October, nearly double the national average of 292,059 British pounds. However, the market dynamics are shifting, with London experiencing only a modest 0.2 percent annual increase, while other cities like Newcastle upon Tyne and Belfast saw more substantial growth of 8.8 percent and 6.8 percent respectively. Affordability challenges and market slowdown Despite the continued price growth in many cities, the UK housing market is facing headwinds. The affordability of mortgage repayments has become the biggest barrier to property purchases, with the majority of the respondents in a recent survey citing it as their main challenge. Moreover, a rising share of Brits have reported affordability as a challenge since 2021, reflecting the impact of rising house prices and higher mortgage rates. The market slowdown is evident in the declining housing transaction volumes, which have plummeted since 2021. European context The stark price differences are mirrored in the broader European context. While London boasts some of the highest property prices among European cities, a comparison of the average transaction price for new homes in different European countries shows a different picture. In 2023, the highest prices were found in Austria, Germany, and France.

The degree of urbanization in the United Kingdom amounted to 84.64 percent in 2023. This shows almost a three percentage point increase over the past decade. The upward trend, though slow, has been consistently positive. What is urbanization? The rate of urbanization indicates the shift away from rural living as people come together in densely populated cities. The United Kingdom is much more urban than the worldwide average. This puts people in closer proximity to jobs, health care, stores, and social opportunities, leading to better economic, health, and social outcomes. For example, areas with higher urbanization have a higher average life expectancy at birth. The darker side of urbanization London is the United Kingdom’s largest city and arguably the financial capital of Europe. However, this economic success has led to increasingly high rental prices, which is an indication of the high cost of living in the city. The higher population density can also lead in an increase in crime. London has one of the highest homicide rates in England and Wales. In spite of these drawbacks, London continues to draw millions of overseas tourists every year.

Data are shown by region, age, income (including equivalised) group (deciles and quintiles), economic status, socio-economic class, housing tenure, output area classification, urban and rural areas (Great Britain only), place of purchase and household composition.

FOCUSON**LONDON**2011:**POVERTY**:THE**HIDDEN**CITY

One of the defining features of London is that it is a city of contrasts. Although it is considered one of the richest cities in the world, over a million Londoners are living in relative poverty, even before the additional costs of living in the capital are considered.

This edition of Focus on London, authored by Rachel Leeser, presents a detailed analysis of poverty in London that reveals the scale and distribution of poverty in the capital.

REPORT:

Read the full report as a PDF.

https://londondatastore-upload.s3.amazonaws.com/fol/fol11-poverty-cover-thumb.jpg" alt="">

PRESENTATION:

What do we mean by living in poverty, and how does the model affect different types of families? This interactive presentation provides some clarity on a complex concept.

CHARTS:

The motion chart shows the relationship between child poverty and worklessness at borough level, and shows how these two measures have changed since 2006. It reveals a significant reduction in workless households in Hackney (down 12 per cent), and to a lesser extent in Brent (down 7 per cent).

The bar chart shows child poverty rates and the change in child poverty since 2006. It reveals that while Tower Hamlets has the highest rate of child poverty, it also has one of the fastest falling rates (down 12 per cent), though Haringey had the biggest fall (15 per cent).

Charts

DATA:

All the data contained within the Poverty: The Hidden City report as well as the data used to create the charts and maps can be accessed in this spreadsheet.

FACTS:

Some interesting facts from the data…

● Highest proportion of children in workless households, by borough, 2010

1. Westminster – 35.6%
2. Barking and Dagenham – 33.6%
3. Lewisham – 33.1%
4. Newham – 31.4%
5. Islington – 30.6%

-31. Barnet – 9.1%

-32. Richmond upon Thames – 7.0%

● Changes in proportions of workless households, 2006-09, by borough

1. Hackney – down 12.3%
2. Brent – down 7.3%
3. Tower Hamlets – down 4.8%
4. Lambeth – down 4.2%
5. Hillingdon – down 4.1%

-31. Enfield – up 5.8%

-32. Bexley – up 7.3%

● Highest reduction in rates of child poverty 2006-09, by borough:

1. Haringey – down 15.0%
2. Newham – down 12.9%
3. Hackney – down 12.8%
4. Tower Hamlets – down 12.1%
5. Southwark – down 11.5%

-31. Bexley – up 6.0%

-32. Havering – up 10.3%

The median annual earnings in the United Kingdom was 37,430 British pounds per year in 2024. Annual earnings varied significantly by region, ranging from 47,455 pounds in London to 32,960 pounds in the North East. Along with London, two other areas of the UK had median annual earnings above the UK average; South East England, and Scotland, at 39,038 pounds and 38,315 pounds respectively. Regional Inequality in the UK Various other indicators highlight the degree of regional inequality in the UK, especially between London and the rest of the country. Productivity in London, as measured by output per hour, was 33.2 percent higher than the UK average. By comparison, every other UK region, except the South East, fell below the UK average for productivity. In gross domestic product per head, London was also an outlier. The average GDP per head in the UK was 31,947 pounds in 2021, but for London it was 56,431 pounds. Again, the South East's GDP per head was slightly above the UK average, with every other region below it. Within London itself, there is also a great degree of inequality. In 2021, for example, the average earnings in the historic City of London borough were 1,138 pounds per week, compared with 588 pounds in Redbridge, a borough in the North East of London. Wages finally catch up with inflation in 2023 After the initial economic disruption caused by the COVID-19 pandemic subsided, wages began to steadily grow in the UK. This reached a peak in June 2021, when weekly wages for regular pay were growing at 7.3 percent, or 5.2 percent when adjusted for inflation. By that November, however, prices began to rise faster than wage growth, with inflation surging throughout 2022. In October 2022, for example, while regular pay was growing by 6.1 percent, the inflation rate had surged to 11.1 percent, Although inflation peaked in that month, it wasn't until June 2023 that wages started to outpace inflation. By this point, the damage caused by high energy and food inflation has precipitated the worst Cost of Living Crisis in the UK for a generation.

Over the five years through 2024-25, revenue is projected to tumble at a compound annual rate of 1.9% to £4.2 billion. Coach and bus transport companies have been grappling with challenging operating conditions. High inflation has driven up fuel prices and staffing shortages have hindered both profitability and revenue growth. Moreover, the lack of targeted government policies and funding for coaches and long-distance buses has weighed on industry growth. Despite these challenges, rail strikes and the cost-of-living crisis have created income opportunities as coach and bus services offer a more reliable and affordable travel option, boosting revenue prospects. While government schemes like the Bus Service Improvement Plan+ support regional bus services, they fall short in assisting long-distance intercity and coach services. This lack of support underscores the government's limited backing of the industry. One major challenge facing the industry is the widespread shortage of drivers. To tackle this, coach and bus companies are intensifying efforts to attract and retain workers through initiatives like paid training programmes and expedited application processes. However, with limited government intervention, bridging this gap remains challenging. The driver shortage also adds to wage pressures, exacerbating the inflationary challenges operators face, including high vehicle and maintenance costs and volatile fuel prices. Coach and bus operators are increasingly expanding their electric and hybrid fleets to meet net-zero emission targets, thereby reducing long-term fuel price volatility. Revenue is projected to climb by 1.4% in 2024-25 as ongoing cost-of-living pressures convince many customers to opt for cheaper travel options like coaches. Revenue is anticipated to swell at a compound annual rate of 1% over the five years through 2029-30 to reach £4.4 billion. Ongoing income pressures will persist in the medium term, bolstering demand for coach and bus services as alternatives to rail transport. Potential future rail strikes will further heighten this demand. Government funding to improve roads and bus services, including implementing simpler and cheaper fares and more bus lanes, will support revenue. As the government continues introducing and expanding low-emission zones across major UK cities, bus and coach companies will continue investing in upgrading their fleets to hybrid and electric vehicles. The increasing number of inbound visitors and plans to expand the UK's airports will create more opportunities for airport shuttle services and contract hire options for day trips and excursions.

The average agreed rent for new tenancies in the UK ranged from 665 British pounds to 2,100 British pounds, depending on the region. On average, renters outside of London paid 1,095 British pounds, whereas in London, this figure amounted to 2,025 British pounds. Rents have been on the rise for many years, but the period after the COVID-19 pandemic accelerated this trend. Since 2015, the average rent in the UK increased by about 25 percent, with about half of that gain achieved in the period after the pandemic. Why have UK rents increased so much? One of the main reasons driving up rental prices is the declining affordability of homeownership. Historically, house prices grew faster than rents, making renting more financially feasible than buying. In 2022, when the house price to rent ratio index peaked, house prices had outgrown rents by nearly 30 percent since 2015. As house prices peaked in 2022, home buying slowed, exacerbating demand for rental properties and leading to soaring rental prices. How expensive is too expensive? Although there is no official requirement about the proportion of income spent on rent for it to be considered affordable, a popular rule is that rent should not exceed more than 30 percent of income. In 2024, most renters in the UK exceeded that threshold, with the southern regions significantly more likely to spend upward of 30 percent of their income on rent. Rental affordability has sparked a move away from the capital to other regions in the UK, such as the South East (Brighton and Southampton), the West Midlands (Birmingham) and the North West (Liverpool, Manchester, Blackpool and Preston).

In the Brexit referendum of 2016, almost three quarters of people who lived in Edinburgh voted to remain in the European Union. Several other major cities also had a majority of remain voters, including the English cities of London, Manchester, Liverpool, Newcastle and Leeds. In the UK’s second-largest city, Birmingham, a slight majority of people voted to leave the European Union. Across the whole of the United Kingdom, the leave side was victorious after winning the votes of 17.4 million people. Perceptions on Brexit in 2025 Since the UK left the EU in 2020, the share of people who regret Brexit has been steadily increasing. As of January 2025, 55 percent of people in Great Britain thought that Brexit was the wrong decision, compared with 30 percent who still supported the decision. Furthermore, a survey from the same month suggested that people thought Brexit had reaped few benefits. Approximately 67 percent of those surveyed thought that it had negatively impacted the cost of living, and 65 percent believing it had diminished the UK economy as a whole. By contrast, the main positive impact of Brexit was seen as the UK's control over its own laws. Demographics of Brexit voters Although several major English cities supported the UK remaining in the EU, every English region, with the exception of Greater London, voted for Brexit. While Wales also supported leave, both Scotland and Northern Ireland had a majority who supported remain. There were also noticeable divisions across age groups, with younger voters typically more likely to vote against Brexit, compared with older ones who supported it. Almost three-quarter of 18 to 24-year-olds voted Remain, compared with 60 percent of those aged 65 or over who backed Leave.

The average transaction price of new housing in Europe was the highest in Norway, whereas existing homes were the most expensive in Austria. Since there is no central body that collects and tracks transaction activity or house prices across the whole continent or the European Union, not all countries are included. To compile the ranking, the source weighed the transaction prices of residential properties in the most important cities in each country based on data from their national offices. For example, in Germany, the cities included were Munich, Hamburg, Frankfurt, and Berlin. House prices have been soaring, with Sweden topping the ranking Considering the RHPI of houses in Europe (the price index in real terms, which measures price changes of single-family properties adjusted for the impact of inflation), however, the picture changes. Sweden, Luxembourg and Norway top this ranking, meaning residential property prices have surged the most in these countries. Real values were calculated using the so-called Personal Consumption Expenditure Deflator (PCE), This PCE uses both consumer prices as well as consumer expenditures, like medical and health care expenses paid by employers. It is meant to show how expensive housing is compared to the way of living in a country. Home ownership highest in Eastern Europe The home ownership rate in Europe varied from country to country. In 2020, roughly half of all homes in Germany were owner-occupied whereas home ownership was at nearly 97 percent in Romania or around 90 percent in Slovakia and Lithuania. These numbers were considerably higher than in France or Italy, where homeowners made up 65 percent and 72 percent of their respective populations.For more information on the topic of property in Europe, visit the following pages as a starting point for your research: real estate investments in Europe and residential real estate in Europe.

Portugal, Canada, and the United States were the countries with the highest house price to income ratio in 2023. In all three countries, the index exceeded 130 index points, while the average for all OECD countries stood at 117.5 index points. The index measures the development of housing affordability and is calculated by dividing nominal house price by nominal disposable income per head, with 2015 set as a base year when the index amounted to 100. An index value of 120, for example, would mean that house price growth has outpaced income growth by 20 percent since 2015. How have house prices worldwide changed since the COVID-19 pandemic? House prices started to rise gradually after the global financial crisis (2007–2008), but this trend accelerated with the pandemic. The countries with advanced economies, which usually have mature housing markets, experienced stronger growth than countries with emerging economies. Real house price growth (accounting for inflation) peaked in 2022 and has since lost some of the gain. Although, many countries experienced a decline in house prices, the global house price index shows that property prices in 2023 were still substantially higher than before COVID-19. Renting vs. buying In the past, house prices have grown faster than rents. However, the home affordability has been declining notably, with a direct impact on rental prices. As people struggle to buy a property of their own, they often turn to rental accommodation. This has resulted in a growing demand for rental apartments and soaring rental prices.

In 2023, the average cost of building a new rental house in the Netherlands reached 428 euros per cubic meter. Building owner-occupied property was slightly cheaper to construct. The source mentions that the numbers concern an average on granted building permits for newly to be constructed homes with a total construction cost of more than 50,000 euros (excluding taxes over the last 12 months). Permits which combine living areas with holiday homes and/or offices were not counted. Note that no numbers were provided on renovation.

What is the market size of the construction industry in the Netherlands?

As of 2022, the Netherlands had over 254,417 active construction companies. These companies were either active in the construction of buildings or development of building projects, civil engineering or were involved in specialized construction activities. One of the more internationally well-known Dutch construction firms is BAM, which is also active in Belgium, the United Kingdom, Ireland and Germany with project deliveries in Denmark, Luxembourg and Switzerland. The revenue of the Royal BAM Group reached a value of 6.3 billion euros in 2023.

How much do you pay for a house in the Netherlands?

Utrecht was one of the provinces in the Netherlands with the highest price for a single-family house. It is also important to look at the different prices in Dutch cities, as they can vary significantly. Residential property in Amsterdam, cities surrounding the Dutch capital (such as Haarlem) or Utrecht sold for much higher prices than a house in, for example, Rotterdam.

At 8.07 U.S. dollars, Switzerland has the most expensive Big Macs in the world, according to the July 2024 Big Mac index. Concurrently, the cost of a Big Mac was 5.69 dollars in the U.S., and 6.06 U.S. dollars in the Euro area. What is the Big Mac index? The Big Mac index, published by The Economist, is a novel way of measuring whether the market exchange rates for different countries’ currencies are overvalued or undervalued. It does this by measuring each currency against a common standard – the Big Mac hamburger sold by McDonald’s restaurants all over the world. Twice a year the Economist converts the average national price of a Big Mac into U.S. dollars using the exchange rate at that point in time. As a Big Mac is a completely standardized product across the world, the argument goes that it should have the same relative cost in every country. Differences in the cost of a Big Mac expressed as U.S. dollars therefore reflect differences in the purchasing power of each currency. Is the Big Mac index a good measure of purchasing power parity? Purchasing power parity (PPP) is the idea that items should cost the same in different countries, based on the exchange rate at that time. This relationship does not hold in practice. Factors like tax rates, wage regulations, whether components need to be imported, and the level of market competition all contribute to price variations between countries. The Big Mac index does measure this basic point – that one U.S. dollar can buy more in some countries than others. There are more accurate ways to measure differences in PPP though, which convert a larger range of products into their dollar price. Adjusting for PPP can have a massive effect on how we understand a country’s economy. The country with the largest GDP adjusted for PPP is China, but when looking at the unadjusted GDP of different countries, the U.S. has the largest economy.

The house price to income index in Europe declined in almost all European countries in 2023, indicating that income grew faster than house prices. Portugal, Luxembourg, and the Netherlands led the house price to income index ranking in 2023, with values exceeding 125 index points. Romania, Bulgaria, and Finland were on the other side of the spectrum, with less than 100 index points. The house price to income ratio is an indicator for the development of housing affordability across OECD countries and is calculated as the nominal house prices divided by nominal disposable income per head, with 2015 chosen as a base year. A ratio higher than 100 means that the nominal house price growth since 2015 has outpaced the nominal disposable income growth, and housing is therefore comparatively less affordable. In 2023, the OECD average stood at 117.4 index points.

In the presented European countries, the homeownership rate extended from 42 percent in Switzerland to as much as 96 percent in Albania. Countries with more mature rental markets, such as France, Germany, the UK and Switzerland, tended to have a lower homeownership rate compared to the frontier countries, such as Lithuania or Slovakia. The share of house owners among the population of all 27 European countries has remained relatively stable over the past few years. Average cost of housing Countries with lower homeownership rates tend to have higher house prices. In 2023, the average transaction price for a house was notably higher in Western and Northern Europe than in Eastern and Southern Europe. In Austria - one of the most expensive European countries to buy a new dwelling in - the average price was three times higher than in Greece. Looking at house price growth, however, the most expensive markets recorded slower house price growth compared to the mid-priced markets. Housing supply With population numbers rising across Europe, the need for affordable housing continues. In 2023, European countries completed between one and six housing units per 1,000 citizens, with Ireland, Poland, and Denmark responsible heading the ranking. One of the major challenges for supplying the market with more affordable homes is the rising construction costs. In 2021 and 2022, housing construction costs escalated dramatically due to soaring inflation, which has had a significant effect on new supply.

As of 2024, there were 975 food banks in Germany. This was an increase compared to the previous year at 964. It was also the highest number of food banks since 1993, when the German Tafel scheme was set up. Food bank usage ‘Tafel’ in Germany is an organization that it similar to the concept of food banks in the United States. These food banks operate at a regional level and provide food that would otherwise be destroyed to those in need either for free or at a heavily discounted price. In 2022, around two million people were using food banks in Germany, this was the highest figure since 2014. This new peak is likely due to the large increase in food prices over the past two years. Both 2022 and 2023 saw a year-on-year increase of over 12 percent. It is not just Germany that is facing higher food prices. Countries across the world have been experiencing a rise in the price of groceries. Over 10 percent of people living in Spain, Great Britain, Germany, France, and Italy said that it was usually difficult for them to afford food items at the end of 2022. In France and Italy there were noticeably higher rates. Poverty When it came to the average financial wealth of adults in Europe, Switzerland, Iceland, and Denmark topped the list. Germany ranked 13th on the list, with average wealth of adults at 113,00 U.S. dollars. This average, however, does not represent the entire population, and there are people in Germany, as in every country, who struggle to finance day-to-day life. In 2022, there were around 16.7 percent of people at risk of living in poverty. This was a slight decrease compared to the previous year, but still significantly higher than in previous years. In certain cities the risk of living in poverty was even higher than the national average. The city of Duisburg, which is located in western Germany, had an at risk of living in poverty rate of over 30 percent. In Bremen, a city close to Hamburg, the share of those facing financial difficulties was almost 30 percent.