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Buying beats renting across 84% of Britain

Despite the fall over the last quarter, buying remains cheaper than renting today across the vast majority of the country and it is cheaper to buy now than rent in more locations than at the same time last year. The shortage of mortgages and difficulties faced by first-time buyers in securing a deposit has increased demand for rental property and led to renting in Britain now costing 16% more on average than buying, up from 11% this time last year.
The average monthly rent in Britain has come down slightly by £9 on average over the past 3 months to £1,470 per month in February 2012. Meanwhile asking prices have dropped by £6,500 on average over the same period to £255,037.
Swansea, Oldham and Cambridge top the list of places where it currently still pays to rent rather than buy with rental discounts ranging from 4.6% to 8.4%. In contrast, it make most sense to buy in Milton Keynes where renting is 38.8% more expensive than servicing a mortgage, leaving renters £2,580 per year worse off on average. York and Preston also offer buyers better deals to buy than rent with renters paying around a third more on average in both places.  
In London, despite the high cost of buying, it still beats renting with the average asking price for a 2-bedroom flat in the capital currently at £452,387, while the average rent for an equivalent property is £2,422 per month, making renting 29.6% more expensive than owning on average. 
Nicholas Leeming of Zoopla.co.uk, said: “Despite a recent increase in first-time buyer activity, demand from remains strong and is keeping rental levels at historic highs. This, along with historically low borrowing costs, makes it as good a time to buy as it ever has been. However many buyers are still unable to take advantage of these conditions because of their inability to secure a mortgage.”

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0 thoughts on “Buying beats renting across 84% of Britain

  1. John Grimes says:

    The simple comparison of mortgage repayment cost against rent leads to inaccurate conclusions. The cost of owning does not stop there , the responsibilities and risk are far higher. Foreclosure can ruin your life whereas you can move home with far less consequence when renting and who can say where mortgage rates will end up after this crisis and what effect that will have on values ? It’s pure speculation.
    People choose to rent now it is not a second class decision , it is the thinking person’s choice.

  2. Major Landlord says:

    If only the whole cost of ownership were truly the mortage payments!

    As a landlord with a turnover of around £150 per annum, I can tell you that EVERY YEAR I spend around 25% of this on repairs and refurbishments of existing (NOT new) properties. So for every £1 I get on rent, i am effectively giving back 30p in repairs and renewals. then there are estate management fees which range from £60 per yer to £200 per year per house, plus lots of other expenses.

    I am not complaining: it’s a business, and these are my overheads. I am just telling potential buyers the truth that the estate agent will not them, so they can make a more realsitic comparison.