According to the latest statistics provided by the LSL, you’ll save up to £132 a month if you buy a home rather than renting it. Currently, hundreds of tenants are cut off the property market, because of the difficulties they face getting a mortgage and this has caused house rents to reach the staggering £725 a month.
Buying a property in the UK is less expensive than renting by £116 a month. The decreasing property prices and the very low mortgage rates are the reason why it is cheaper to buy your own home than to rent one. Rents are rising by up to 1/5 a month and reach record prices and according to the LSL’s statistics, buying a home can save you up to £200,000 over lifetime.
The LSL’s review has focused on the cost of buying or renting a 3-bedroom property which costs an average of £157,400. The research shows that buying a property is now approximately 20% cheaper than renting. The £132 a month difference is the highest difference which the survey has recorded since its start in 2008.
Currently, a 3-bedroom property is rented for an average of £732 a month in different parts of the UK. The biggest difference is recorded in London where homeowners could cover the entire cost of a house with just £1,108 a month while they’d have to pay £1,284 if the property was rented.
The estimated cost of purchasing a property includes household maintenance, insurance costs, repairs, money lost by funding a deposit and mortgage repayments. The current prices are the exact opposite of 2008, when it was much cheaper to rent a home than to buy one. In 2008, you’d had to pay £724 a month for a rented home while purchasing a home would have cost you £1,048 a month. This means that you’d had to pay 45% (£324) more to buy a home in 2008.