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Tuesday 31 January 2012
Research carried out by Halifax has shown that buying property works out £100 a month cheaper than renting.
The results of Halifax’s survey show that the average monthly rental repayment on a three bedroom house in the UK is £716 but the average monthly mortgage repayments in a like for like comparison is £600.
Buying was shown to be more cost effective than renting in all but one of the 12 UK regions in 2011 with Wales as the only region where it is cheaper to rent than to buy.
The Halifax Buying vs. Renting Review incorporates mortgage repayments, deposit and insurance costs, maintenance budget and buying costs.
According to the research the cost of buying a home has dropped £328 over the last four years driven by a decrease in house prices and lower monthly mortgage rates. Conversely the cost of renting has risen by 5%.
Housing Economist at Halifax, Martin Ellis noted: "The affordability gains for buyers relative to renters in the last three years have been significant. The average mortgage payment has fallen dramatically over recent years as a result of falling house prices and mortgage rates."
“At the same time, rents have risen due to strong demand for rented accommodation. Nonetheless, despite the improvement in the relative affordability of buying a home, the number of purchasers has continued to fall due to the ongoing challenges in raising a deposit and the considerable uncertainty over the prospects for the UK economy, which have severely constrained housing demand."