Cheaper to buy than rent in over a third of cities in the UK

Taylor Scott International News

It is cheaper to buy than rent in more than a third of cities in the UK with buying most effective in the north of the country, new research shows. Mortgage payments are less expensive than monthly rent in 36% of British cities and home owners in Glasgow are more than £100 per month better off than their renting counterparts. However, in the south renting still beats buying, with buyers in London, Reading and Cambridge forking out hundreds more to own property there, according to the research from property search firm Zoopla. But overall the analysis of the cost of renting a two bedroom home compared to servicing a mortgage shows that nationwide, renters still pay £58 less per month than buyers. Buyers did particularly well compared to their renting counterparts in Scotland and the North of England. In Glasgow, rental payments amount to an average of £596 per month, whereas monthly mortgage payments only totaled £447. This means Glaswegian buyers are paying 25% or £149 a month less to own property than rent it. The research also shows that in Hull, buyers who pay on average £397 a month are £55 better off than renters in the city who pay an average of £452 per month to rent. Conversely, the south eastern corner of the UK represents the best value for money for renters. The average London tenant pays rent of £2,218 per month, whereas the capital’s home owners pay an average of £3,302 on servicing their mortgages, meaning buyers there are paying 49% or £1,084 a month more than the city’s renters. Buyers in Reading and Cambridge can also expect to pay more. On average, owners in Reading typically pay £3,600 a year more than tenants, while servicing a mortgage in Cambridge costs £3,700 more a year on average. Nationwide, the current average asking rent for a two bedroom home is £666 per month, compared to an average asking price of £145,840. As a result, servicing a 90% LTV mortgage typically costs £58 more per month than the average tenant would pay for renting such a property. Aside from the initial deposit, and all the fees associated with the actual house purchase, the financial strain of buying can be overstated. In addition to the peace of mind that home buying brings, many owners enjoy more disposable income at the end of every month than their renting counterparts, said Lawrence Hall of Zoopla. ‘If they can make the leap, and are willing to relinquish the flexibility that comes with renting, tenants up north in particular would be much better off buying and paying off a mortgage every month,’ he explained. He pointed out that Scotland and the North of England are cementing their standing as international university hubs with top universities in York, Edinburgh and Durham. ‘This means increasingly high numbers of students are flock to these areas, all looking for places to stay and… Taylor Scott International

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