Housing – rents and earnings - England and Wales analysis

This post looks at the data for England and Wales.  In all 315 local authorities were covered.  These include unitaries, district councils and London Boroughs.  The differences in population size are therefore quite wide. Analysis of private sector rents and several other variables provides some interesting results.

 

Variations in private sector rents at local authority level can largely be attributed to resident earnings.  This is similar to the situation with house prices.  Analysis of earnings from the Annual Survey of Hours and Earnings and private sector rents at local authority level shows that there is a definite relationship.  Areas with higher earnings have higher rent levels.  Using the statistical measure of correlation indicates a positive correlation of 0.79, which is considered strong.

 

Urban areas where earnings are generally higher exhibit higher rent levels. Of the top twenty areas, eighteen are London boroughs.  Of the bottom twenty areas, five are in Wales with six are towns in Northern England. Rents as a percentage of median income range from 93.8% in Kensington and Chelsea to 23.1% in Hartlepool.

 

Cornwall

The figures for Cornwall gave an average rental of £998, with annual earnings of £28,210 (monthly = £2,351).  Rent therefore equals 42.5% of monthly earnings.  For comparison, rents equal 29.7% of earnings in Sunderland, despite the fact that earnings are rather similar! 

 

Analysis of the data using Full-time earnings for Cornwall and local authorities with similar earnings throws up some interesting points. With the exception of Salford, all the authorities have more affordable rents than Cornwall.  The difference between Cornwall (and Salford), and the other authorities is that both have a higher share of dwellings, which are unoccupied/second homes.

 

Area	Monthly earnings (FT)		Affordability		Unoccupied	2nd homes
		Rank	% of FT  income	Rank	Rank	Rank
	£	No	%	No	No	No
Plymouth	2932	252	33.5	143	84	108
Middlesbrough	2931	253	23.4	286	279	98
Merthyr Tydfil	2929	254	26.1	243	114	82
Redcar and Cleveland	2926	255	21.5	308	94	97
North East Lincolnshire	2921	256	20.9	313	126	120
Cornwall	2917	257	34.2	132	10	14
Hyndburn	2916	258	21.7	305	250	74
Doncaster	2914	259	23.2	290	172	162
Salford	2913	260	39.7	80	44	45
South Kesteven	2910	261	28.5	205	154	220
Lancaster	2907.5	262	27.2	231	48	41
Rhondda Cynon Taf	2903.1	263	25.6	256	207	69

 

 

Unoccupied dwellings

Looking at affordability and the share of dwellings, which are unoccupied, indicates a higher share in the worst 32 local authorities for affordability.  Analysis of Full-time earnings and affordability provides examples of where an authority with a higher share of unoccupied dwellings has worse affordability than those authorities with similar earnings levels.

  

Second homes and holiday lets

Although the census data includes second homes, holiday lets are subsumed within the vacant element and there is not a database, which clearly sets out the number of lets in each local authority area. [Business rates data is insufficient in that it excludes dwellings, which fall outside the relevant thresholds].

 

Data on the share of dwellings used as holiday lets would be useful in determining the role of such properties in influencing private rents and affordability in an area.

 

Conclusion

As with house prices, local variations in private rents largely reflect earnings levels whether total earnings or full-time earnings. Affordability reflects this being worse in areas with higher earnings. Areas with similar earnings but with a higher share of unoccupied dwellings exhibit worse affordability than earnings figures would suggest.

 

Notes

Local authority areas vary in terms of population from large cities to smaller district councils in more rural areas.

 

Local authority data for England, Wales and areas in Scotland.

 

The private rent figures used are the average total for an area.  This will be influenced by the composition of property sizes.

 

Earnings data is for one person. A household with two adults would therefore have a higher household income. 

 

Earnings figures are for employment only.  Some households will have higher earnings due to other sources – investment, property, while self-employment earnings tend to be lower.

 

Sources

Office for National Statistics, (2025), Annual Survey of Hours and Earnings, Resident earnings - Total Gross median.

 

Office for National Statistics, (January 2026), Private rent and house prices, UK: December, Statistical Bulletin. Data figure 8.