Buying vs renting – which is cheaper?
The gap between the cost of buying a home and renting one is down 59%, to its lowest level in nine years, according to Halifax.
Buyers are now saving an average £366 a year compared to renters, down massively from £900 a year in 2017, as the gap continues to narrow.
But homeowners are still better off than renters in all parts of the UK when all costs are considered.
Housing costs, including a mortgage on a three-bed home in the UK, were £729 a month in December 2018, compared to the average monthly rent of £759 for the same type of property.
Buying in recent years has meant lower monthly costs than renting across the UK, but the latest picture shows an mixed picture.
Outside of London, Scottish buyers have the highest average annual savings of 20% (£1,574) vs renting, compared to the modest financial gain in Yorkshire, where the cost of buying is only 5% lower than renting.
Buyers are better off than renters in Wales, with annual savings of over £2,000 (14%) where by in Northern Ireland mortgage payers are saving 7% less than their Welsh counterparts at £382 annually.
Russell Galley, managing director of Halifax, said: “The gap between buying and renting is narrowing, primarily driven by reduced first time buyer prices deposits in some regions and continuing house price growth, meaning buyers are paying more on their mortgages.
“With more products available for borrowers, these factors combined have pushed up the price of buying quicker than the price of renting. Meanwhile, the cost of rent, household maintenance and average deposits have remained broadly flat.”