Graduates need £39k salary to rent in London despite growth in entry-level jobs

Graduates seeking to relocate for work are facing growing affordability pressures, with new research showing that entry-level salaries are often failing to keep pace with rental costs in some of the UK’s strongest jobs markets.

Analysis by flatshare platform SpareRoom found that graduates would need a minimum salary of £39,103 to rent affordably in London, where average monthly room rents have reached £978. In Oxford, identified as the UK location with the fastest growth in entry-level roles, graduates would need a salary of £32,853 to afford the average room rent of £821 per month.

The research combines rental market data with employment figures and highlights the challenges younger workers face when trying to move for career opportunities. While Oxford, Cambridge, Edinburgh and London continue to generate growing numbers of entry-level positions, rental costs in these locations are often significantly higher than the earnings of many young professionals.

SpareRoom found that Nottingham and Exeter offer a more favourable balance between employment opportunities and affordability. Nottingham ranked sixth for year-on-year growth in entry-level jobs while average room rents stood at £581 per month. Exeter ranked third for entry-level job growth, with average monthly room rents of £662.

The findings also point to a longer-term shift in the rental market. In 2015, people aged 18 to 24 accounted for 32% of the flatshare market. By 2025, that figure had fallen to 26%, suggesting younger renters are increasingly struggling to access accommodation.

According to Office for National Statistics data cited in the report, the median annual salary for full-time workers aged 22 to 29 is £29,855. SpareRoom said this effectively prices many young workers out of half of the UK’s top eight areas for entry-level job growth.

Matt Hutchinson, director at SpareRoom, said: “Graduates chasing job opportunities and looking to relocate may find affordable rooms are scarce, because rents – although no longer rising dramatically – haven’t seen any meaningful decreases either.

“Under 25s are in steady decline in the rental market because grads today aren’t only contending with high rents. Student loan repayments reduce disposable income at a time when the basic cost of living – including energy bills, food and fuel – is sky high, and the loan repayment threshold is due to be frozen from next year, triggering more grads into repayments. So it’s little wonder more young people aren’t leaving home, even if it does limit their career opportunities.