Monday, 30 March 2015

Report claims renting is more expensive than buying

Renting a home is more expensive than buying in eight out of 10 homes across the country, a new survey claims.

Property website Zoopla said it was cheaper to buy a home in four in five of the 50 largest towns and cities throughout the UK.

The research, which showed the average cost of renting was 9.7 per cent higher than the cost of owning, looked at the current asking prices and rents of two-bedroom flats and assumed interest-only mortgage payments of 5 per cent per annum.

Milton Keynes was the top place in the country where average rents exceeds the cost of servicing a mortgage by 43 per cent.

Renters in Milton Keynes will be on average £2,964 per year worse off compared to owners.

Poole was the location where renting was much more economical than buying with the average tenant saving £3,240 a year buy renting instead of owning.

Nicholas Leeming, business development director of Zoopla.co.uk, said: ‘The relative cost of renting as opposed to buying has increased over the past 12 months as rents have risen and house prices and interest rates have remained flat.

‘Almost 750,000 would-be first-time buyers have reluctantly ended up as renters over the past 3 years as a result of being unable to get a mortgage.’

Top 10 locations where renting beats buying

RankLocationAvg. Asking Price*Avg. Monthly Rent*Rent vs Buy**
1Poole£243,466£744-27%
2Plymouth£157,134£573-12%
3Stockport£145,502£558-8%
4Oldham£122,716£477-7%
5Bristol£188,893£753-4%
6Huddersfield£123,538£497-4%
7Bournemouth£183,225£745-2%
8Lincoln£126,470£519-1%
9Swansea£169,773£702-1%
10Cardiff£157,610£6560%

Top 10 locations where buying beats renting

RankLocationAvg. Asking Price*Avg. Monthly Rent*Rent vs Buy**
1Milton Keynes£137,800£82143%
2Birmingham£127,127£72737%
3Warrington£108,410£58229%
4York£162,645£87729%
5Northampton£109,167£57927%
6Coventry£107,363£57027%
7Bradford£96,281£49924%
8Preston£107,052£54923%
9Peterborough£109,456£55121%
10Barnsley£431,366£2,13719%

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