Average London rent reaches £2,484 as standard affordability checks point to a £74,520 income

Propertymark’s latest London figure is the part landlords should pay attention to: at an average rent of £2,484 per month, a tenant would need around £74,520 a year to meet a common 30x annual income affordability check. A month earlier, at £2,385, the same calculation came to about £71,550. On that basis, the indicative income requirement has risen by £2,970 in a month using the same formula.

That £74,520 figure is not a legal requirement. It is an affordability calculation based on a widely used industry rule of thumb applied by many referencing providers and letting agents. There are no new statutory duties or deadlines in Propertymark’s report. Landlords still need to comply with the existing rules on Right to Rent checks, tenancy deposit protection within 30 days, prescribed information, gas safety, EICRs where required, minimum EPC standards, and the correct legal route for any rent increase.

The practical issue is that affordability pressure is increasing in a market where supply remains tight in many parts of London. At £2,484 per month, a tenant paying the rent alone would spend £29,808 a year before council tax, utilities and travel. In higher-value family markets, the income threshold used by agents and insurers may be higher still. If you let in Zone 2 and Zone 3 commuter locations, applicants who passed a reference check earlier in the year may now fall short on the same salary if the asking rent has moved up.

Check exactly how your referencing standard is being applied

The first step is to review your referencing criteria now and make sure they are documented. If your agent or insurer uses 30x rent for a sole applicant, or a different multiplier for self-employed tenants, guarantors or sharers, ask for the exact rule in writing. If you self-manage, set out a clear policy covering:

• acceptable income evidence
• guarantor requirements
• treatment of bonuses and commission
• how self-employed applicants are assessed
• whether joint incomes are combined and on what basis

A policy that changes from applicant to applicant is harder to justify if challenged.

Avoid turning affordability checks into a blunt filter

Do not treat an affordability calculation as a blanket rule in every case. A minimum income threshold can create indirect discrimination risk under the Equality Act 2010 if it disadvantages particular groups and cannot be justified as a proportionate way of managing genuine financial risk. The law does not prevent affordability checks, but landlords and agents should apply them consistently and be able to explain the business reason behind them.

In practice, that means using the same written criteria for all applicants, recording why any exception was made, and avoiding loose wording in adverts or emails such as “professionals only”. If you state an income expectation, make sure it is genuinely linked to the rent level and your referencing process.

Re-test the asking rent against current local evidence

The second action is to compare your asking rent with current local comparables before a renewal or re-let. Propertymark’s figure is a London-wide average, not a borough-by-borough breakdown, and the underlying article does not give pricing by property type. That matters because a one-bed flat and a family house will sit in very different affordability bands even within the same broad area.

If you pitch the rent at the very top of the market without testing demand, you increase the risk of:

• failed references
• a longer void period
• a stale listing that later needs a reduction

For many landlords, the real decision is not simply how high the headline rent can go, but whether a slightly lower figure could produce better net income through faster letting and lower arrears risk.

HMO landlords should check licensing and planning before changing strategy

For HMO landlords, room-by-room affordability can widen the applicant pool, but only if the property is properly licensed, the use is lawful, and local demand supports it. In boroughs with active HMO enforcement, any change in letting model should be checked against:

• mandatory or additional licensing rules
• licence conditions
• planning position, including any Article 4 direction

Changing strategy without checking those points can be expensive.

Check insurance and tenancy paperwork while rents are moving

Where rents have risen quickly, it is worth reviewing your rent guarantee insurance. Some policies require referencing to a specific standard and may only cover the rent shown in the policy schedule. Also make sure any tenancy deposit was protected correctly and that the prescribed information was served on time, because procedural errors can weaken your position if arrears later lead to possession proceedings.

Landlords should also check that adverts, heads of terms and tenancy agreements all show the correct rent and clearly state what is included. If you are increasing rent during the tenancy, use the proper legal route: a rent review clause, a written agreement signed by the tenant, or a Section 13 notice where applicable. Market data does not change the statutory process.

What landlords should do next

Three sensible next steps are:

1. Within the next two weeks, ask your agent or referencing provider to confirm the affordability formula and any guarantor rules they are applying.
2. Before your next renewal or re-let, compare your proposed rent with at least three current local comparables.
3. Before changing applicant criteria, put the policy in writing and check it against your insurance terms and Equality Act risk.

For landlords in Wimbledon and wider south-west London, this is mainly a risk-management story rather than a legal change. Rents may be rising, but affordability pressure is rising with them, and that affects who will pass referencing and how likely a new rent level is to hold.

This article is general information, not legal advice.