Zoopla: Owning is 13% cheaper than renting
Owning a home in the UK is 13% cheaper than renting, according to new research by Zoopla.co.uk.
This time last year, renting was £993 more expensive annually than repaying a mortgage. The difference now is £961 as the average UK house price has increased.
The average cost of renting a two-bedroom flat is now £84 (1.1%) more expensive than last year, whereas the cost of an interest-only mortgage on the same type of property has increased £120 (1.7%) on average.
Lawrence Hall of Zoopla.co.uk said: “Buying remains significantly more cost-effective than renting, but the gap is closing.
“With increased mortgage availability buyer demand is rising, especially amongst first time buyers.”
“With increased mortgage availability buyer demand is rising, especially amongst first time buyers, whilst rental demand is falling so house prices are generally rising faster than average rents, although it is clear that large regional differences still exist.”
York is the most cost effective place to buy a home in as average monthly rent for a two-bedroom property is £940 and the average asking price is £159,079, which, means there is a rental premium of 41.8%.
Ben Hudson, managing partner at Hudson Moody letting and estate agents in York, said it is currently a “great time” for landlords to purchase buy-to-let property in York as rents are continuing to rise.
“The yields are the best they have been for a number of years and interest rates remain low, making the buy-to-let market a good investment.”
“The yields are the best they have been for a number of years and interest rates remain low, making the buy-to-let market a good investment,” he added.
Mr Hudson said the best areas to buy in are within a mile radius of the city centre, but those interested in student property should look up towards the university.