Now it’s cheaper to buy a home than rent one right across the UK
Average first-time buyers could save over £2,250 a year once on the property ladder compared to renting, according to Santander.
The lender found that aspiring first-time buyers would have lower monthly outgoings if they bought a property rather than renting one. And that holds true for all regions of the UK, where average monthly rental prices are now higher than average mortgage repayments.
Make a saving
The average monthly rent in the UK is currently £912 per household, compared to monthly repayments of £723 for the average first-time buyer household. Homeowners could save an average of £189 a month or £2,268 a year compared to renters.
Miguel Sard, managing director of mortgages at Santander UK said: “Many first-time buyers understandably focus on the challenge of saving for a deposit and wonder how they will afford a property. However, it is often assumed that when you purchase a property you will be under greater financial pressure and our research shows the reverse is true.
“Of course, buying a property is a major financial investment with upfront costs to consider, but long-term the financial benefits can be significant. With annual savings averaging well over £2,000, this can really mount up over time and of course once the mortgage is paid off you have a valuable asset to show for it.
Prospective first-time buyers in London are set to make the biggest monthly savings by making the switch from renting to property ownership, as average rents exceed mortgage payments by over £289 a month or £3,468 a year.
First-time buyers in Northern Ireland would see themselves £178 better off per month.
At the other end of the scale are those living in the East of England, where typical first-time buyer monthly mortgage payments exceed average rents by only £43.