£124 a month cheaper to buy a home than rent
Eight buyers chase every new instruction across the UK
Alex Johnson has been part of The Independent's online team since 2007. He has been writing about microarchitecture on his internationally-acclaimed Shedworking blog since 2006 and is the author of Shedworking: The Alternative Workplace Revolution. His latest book is Bookshelf, published by Thames & Hudson.
Monday 17 March 2014
The cost of owning a home in the UK is £124 per month lower than renting, according to Halifax. This is the largest difference since 2009, with rents rising 18 per cent in the last four years.
The report says that the average monthly costs of owning a three bedroom house were £645 in December 2013, 16 per cent lower than the typical monthly rent of £769 which the same property costs
In 2008, the monthly ownership cost was on average £226 (31 per cent) higher than rental costs.
Craig McKinlay, Mortgage Director, Halifax said: "There has been a substantial improvement in the affordability of owning compared to renting in recent years. Buying will continue to be a more financially attractive option as the cost of owning a home remains stable. With greater availability of mortgages that require smaller deposits, the property ladder has also become even more accessible for those who can afford the monthly costs of owning but had previously not been able to save the necessary deposit."
Owning a home is most affordable compared to renting in London where the typical homebuyer pays £188 a month less than the average renter (£1,196 vs £1,384). In the West Midlands and East Anglia the difference is tiny, with average monthly buying costs only £6 lower than average monthly rental costs (£553 against £559 and £633 against £640 respectively).
Meanwhile, a second report from Sequence - owners of Barnard Marcus and William H Brown - suggests that eight new buyers are chasing every new property that goes on the market, with new buyers rising more than a quarter year-on-year.
David Plumtree, Chief Executive at Sequence, said: "Activity in the market and competition for property across the country is heating up as we edge closer to spring. The shortage of available property is resulting in rapid price growth, with the average UK house price now 12 per cent higher than this time last year and showing no signs of slowing down unless the supply/demand imbalance is rectified.
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