Buying is now cheaper than renting in every part of the UK, Santander said this morning.
The bank said that the average first-time buyer could save £2,300 a year once on the property ladder.
The average monthly rent in the UK is currently £995 per household compared to monthly repayments of £805 for the average first-time buyer household, meaning an average saving of £190 a month.
In London, average first-time buyer would save £179 a month. In the south-west, the saving would be £192.
The region with easily the smallest difference between mortgage and rental payments is the east, offering first-time buyers the possibility of saving just £2 a month.
According to Santander, the average house price across the UK is £212,610 (it used ONS statistics, not the Land Registry, Nationwide or Halifax data which all give cheaper house prices).
Based on ONS data, purchasers with a 21% deposit – which Santander says is the average for a first-time buyer – would need a deposit of £44,648.
Comments (5)
I take it Robert and Kelly you do not make your living from rentals? Why do Purelt sales agent always knock the rental market ?
One of the most regulated professions in the country.
Not directly, but that doesn’t make what we said incorrect.
An additional way buying is cheaper is that a letting agent will happily let you a house you’ll struggle to afford, but there’s no way a mortgage lender will at the mo.
Doesn’t take into account costs of acquisition, building insurance, maintenance/repairs and refurbishments, wear and tear of carpets, appliances, etc., service charge and possibly water rates. Renting is NOT generally more expensive than buying. Also, interest rates will rise at some point.
After 25 years of renting money from the mortgage company a buyer owns an asset (whatever its value is), after 25 years of renting a renter only has their deposit.