Rent as a Percentage of Income

Median Rent figures are easily available for Brisbane in Queensland, from the Queensland Residential Tenancies Authority.

These figures were available for the 3 months ended Sept 2010.

    Weekly RentProperty TypeNew Rentals
    $365.00Two bedroom flats/units4,303
    $380.003 Bedroom Houses3,117
    $280.00One bedroom flats/units2,226
    $450.004 Bedroom Houses1,627
    $380.003 Bedroom Townhouses1,479
    $430.00Three bedroom flats/units893
    $350.00Two bedroom houses627
    $350.00Two bedroom townhouses315

From the above 14,000 new tenancies in that 3 month period, in the Brisbane area, we are able to get an idea of the real accommodation costs for those in rental properties.

If we then look at those costs in relation to the average wage, we see the following:

Queensland average Full Time earnings, $1,284.70 per week.

Comparing the rent of a 3 Bedroom House in Brisbane, to the average persons wage in Queensland, we see that it is 29.6% of that persons wage.

Looking at UK wages, with a source from the BBC, the average Full Time earnings in different regions of the UK were, in 2008:

    LocationAnnual Income
    London£46,462
    South East£32,819
    East£30,318
    Scotland£28,296
    South West£28,182
    East Midlands£28,057
    North West£28,045
    West Midlands£27,872
    Yorkshire & the Humber£27,534
    Wales£25,677
    North East£25,551
    Northern Ireland£25,550

These 2008 wages should be increased by 2.6% to use as a 2010 figure, based on this:

  • UK Average weekly income Aug 2008 £430
  • UK Average weekly income Aug 2010 £441 increase of 2.6%

Therefore, the equivalent UK weekly rentals, for a 3 bedroom House, based on the Brisbane figures, should be:

    Weekly RentLocation
    £272London
    £192South East
    £178East
    £166Scotland
    £165South West
    £165East Midlands
    £164North West
    £163West Midlands
    £161Yorkshire & the Humber
    £151Wales
    £150North East
    £150Northern Ireland

Some UK rental figures can be seen at rentright, and these show the national average rent for a 3 bedroom property as:

3 bedroom properties and flats
Average Rental Prices for October 2010: £1131 or £261 per week.

These same 3 bedroom properties, broken down by location, have average weekly rental figures of:

    Weekly RentLocation
    £520London
    £240Oxfordshire
    £205Cornwall
    £198Kent
    £144West Midlands
    £143Lancashire
    £141West Yorkshire

This seems to show that some areas of the UK are comparable, in a percentage of income term, to the Brisbane rental figures. However, London is a much higher % of income, with an average rental of $520 pw or 58% of the London average full time income.

Sources:

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