As an international city that’s renowned for its cultural activities, beautiful architecture, and concentration of opportunities, London has become one of the most sought-after places to live in the United Kingdom. Unfortunately, for anyone looking to move to London, it seems that everyone has the same idea. In this blog we look at most affordable homes in London.
Private rental prices increased by 6.2% in the UK over the past 12 months. In London, this figure is even higher, with rental prices increasing by 6.9% to January 2024.
Source. The graph demonstrates rising rental prices over the last 12 months in the UK and London. January 2016 to January 2024.
With mortgage rates reaching a 23-year peak back in 2023 and the average renter spending 41% of their income on rent, we’re all looking for a way to save more money. With that in mind, we’ve collected data on the most affordable homes in London.
In this article, we’ll detail the cheapest places to live in London, pointing out the areas where you can rent and buy without breaking the bank.
Let’s dive right in.
Where are the most affordable places to live in London? Exploring the cheapest London areas
Both renters and buyers will find that the most affordable places to live in London tend to be in the same areas. Exploring the graphs below, you’ll spot that the lowest renting and house prices are all on the outskirts of London. Prices tend to increase sharply as you move toward zones one and two.
Source: London.Gov’s map of average rental prices
Source. Average house prices across London.
With that in mind, let’s explore the cheapest areas to rent in London. In these boroughs, you’ll also find the cheapest average house prices.
Cheapest borough to rent in London: Bexley
Bexley, located in South-East London, averages £1,500 for a three-bedroom house.
Second cheapest borough to rent in London: Havering
Havering, located in North-East London, averages £1,500 for a three-bedroom house.
Third cheapest borough to rent in London: Barking and Dagenham
Barking and Dagenham, located in East London, averages £1,550 for a three-bedroom house.
Fourth cheapest borough to rent in London: Hillingdon
Hillingdon, located in West London, averages £1,600 for a three-bedroom house.
Fifth cheapest borough to rent in London: Croydon
Croydon, located in South London, averages £1,625 for a three-bedroom house.
Sixth cheapest borough to rent in London: Enfield
Enfield, located in North London, averages £1,700 for a three-bedroom house.
Seventh cheapest borough to rent in London: Bromley
Bromley, located in South-East London, averages £1,750 for a three-bedroom house.
Eighth cheapest borough to rent in London: Redbridge
Redbridge, located in North-East London, averages £1,750 for a three-bedroom house.
Ninth cheapest borough to rent in London: Waltham Forest
Waltham Forest, located in North-East London, averages £1,750 for a three-bedroom house.
Tenth cheapest borough to rent in London: Greenwich
Greenwich, located in South-East London, averages £1,850 for a three-bedroom house.
Where are other cheap places to live in London?
While these boroughs aren’t in London’s top 10 most affordable areas, they are numbers 11-15.
These are slightly more central than many of the other options while still falling on the lower end of the rent scale:
- Hounslow: £1,850 for three bedrooms.
- Lewisham: £1,850 for three bedrooms.
- Newham: £1,872 for three bedrooms.
- Kingston upon Thames: £1,988 for three bedrooms.
- Merton: £2,100 for three bedrooms.
Explore other areas using the Private Rental Market in London Census Data.
Cheapest places to live in London: How do I find cheap rent in London?
Even in the most affordable places to live in London, renters and buyers will still face higher costs than every other area of the UK.
Here are a few quick tips to help you reduce your cost of renting in London:
- Consider transport links: While most people want to live as centrally as possible, finding places that are further out but with strong transport links can be a great solution to help find cheaper rent.
- Find flatshares: Shared housing is much cheaper than renting alone. Use sites like Spareroom to find potential London flatshares.
- Find Co-living in London: Co-living spaces offer furnished rooms with flexible leases, allowing you to rent for periods that suit your needs.
The need for affordable homes in London
Since the pandemic, house hunting has become increasingly competitive. Nowadays, it isn’t uncommon for people to have to offer way over the asking price to stand out from the crowd – which is a nightmare for people who are struggling to buy in the first place.
The London Plan, outlined by London Mayor Sadiq Khan, has a strong focus on the need for affordable housing, but the promise of 1000s of affordable homes in the future means little to someone who is looking to move today.
Affordable housing is also about more than just the amount it costs; it’s also about the quality of life it can uphold. Recent census data suggests that the number of people per household is increasing in London. This means that there are more people living in the same amount of space, and struggling to upsize due to both competition and the cost of living crisis.
How to buy affordable housing in London
For people looking to buy in London, we have good news. House prices in the UK decreased on the whole by 1.4% in 2023. Yet, London surpassed this figure, coming in at a total decrease of 4.8%.
Source: Average house price by region in England.
While the average house price in London is still the most expansion of any region in the UK, buyers are looking at cost reductions over the coming months. This news, combined with our list of the cheapest places to live in London, will help you find an affordable home.
How to find affordable rent in London: The London Living Rent Scheme
The City Hall of London introduced a government-backed scheme London Living Rent (LLR), back in 2018. This project aims to provide citizens of London with a rent contract that is no more than one-third of their total salary.
Depending on the area you want to live in, the London Living Rent Scheme may be a potential way of finding cheaper rent in London. LLR housing costs range from £900 to £1400 a month for a two-bedroom home.
Source. The average price of a two-bedroom home in each London ward
To qualify for LLR eligibility, you must fulfil the following criteria:
- Work or live in London
- Have under £60,000 in household income
- Not own a residential home
- Be unable to buy a home
- Have a formal tenancy or live with friends or family due to being unable to manage housing costs.
If you qualify, the London Living Rent program could be a useful way of finding cheap rent in London and reducing housing costs. Alternatively, browse our list of the cheapest areas to live in London to find lower average rent prices.
Factors to consider when choosing an affordable home in London
Affordability is subjective, and there are many factors to keep in mind when looking for somewhere to live in London. Just because somewhere is cheap doesn’t mean it will suit all aspects of your lifestyle. Often compromises need to be made based on your individual priorities.
When it comes to spending money on transport, Londoners spend almost double the national average. Moving to a cheaper location may not be worth it if it greatly impacts the cost of your commute. Likewise, moving to a location that seems more expensive could work out less costly than you think if it reduces your travel expenditure.
Buying vs renting
It’s undoubtedly cheaper to rent in London than it is to buy, but in doing so you’re often compromising on space and control over your home. However, short tenancy agreements when renting do give you freedom. For example, if you move to an area and it doesn’t agree with you, it’s easier to relocate. On the other hand, some people will prefer the investment of monthly mortgage payments.
The pandemic resulted in an uptick of people looking to trade in their urban lifestyle for the countryside. More people are using their ability to work remotely as an opportunity to improve their surroundings. People left London in droves, but it is once again one of the most searched-for locations for people looking to move. If you’re London-based and relocating, what do you need from your new neighbourhood? And if you’re moving in from out of town, do you have realistic expectations of what city life will be like?
Need support or advice for your upcoming London move? See how Happy2Move can help
No matter where the home of your dreams is in London, you’ll be living in one of the most iconic cities in the world. Full of history, art, culture, and opportunities, London is a wonderful place to live for all ages.
If you’re able to find a house to buy or rent and need help moving, look no further. Happy2Move has been making moves easier for Londoners for over a decade. We offer a wide range of services, including:
- House removals
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For a stress-free move, count on our highly trained team to meet your moving day needs without a hitch. Get one step closer to settling into your new home in London.
Get a free quote or get in touch today to find out more.