Renting costing £1,080 more per year than buying
Published by Max Salsbury for 24dash.com in Housing and also in Finance
Renters are paying £1,080 a year more than those servicing an interest-free mortgage, according to research by property website Zoopla.co.uk.
The company's analysis of Britain's top 50 towns based on number of households revealed that owning is more cost effective than renting in 90% of locations.
It was found that the average monthly rent on a two-bedroom flat is £668, with the average asking price for such a property currently standing at £138,769.
An interest-only mortgage at 5% a year would cost £578 per month - a weekly saving of £21 compared to renting.
York tops the list of places where renting is currently most expensive compared to buying, with a 76.1% rental premium.
Swansea, Cambridge, Bournemouth, Dundee and Huddersfield were the only places where renting was found to be actually cheaper than buying.
Zoopla's Lawrence Hall said: “The cost of renting continues to balloon as a result of first-time buyers continuing to struggle to get affordable financing. Even for an interest-only mortgage, it’s generally much more cost-effective to buy. Property prices are low by historic standards, and sellers struggling to sell are reducing asking prices, meaning there are still some bargains to be had for those lucky enough to be able to get a mortgage.”