Buying Vs Renting Gap Widens During Lockdown

New data, based on the housing costs associated with a mortgage on a three-bed home versus the average monthly rent of the same property type, has revealed that first-time buyers are now £800 a year better off than renters. According to research from Halifax, the gap between buying and renting has stretched by 8% in the past 12 months. Monthly rental costs have increased by 10% to £821 in the past year, while monthly buying costs have increased by 1% to £753 during the same period. The difference was only 1% in 2019, which dropped sharply from the previous year, when the monthly difference between buying versus renting was 10%. Read more on the Property Reporter website.

https://www.propertyreporter.co.uk/property/buying-vs-renting-gap-widens-during-lockdown.html

Renting A Home Is Cheaper Than Buying In 54% Of British Cities

Renting a home is now cheaper than buying one in more than half (54%) of British cities. The average monthly rental payment on a two-bedroom property rings in at £690 across Britain's 50 biggest cities – £47 less each month than those making average mortgage repayments of £737. Research has found that Londoners fare best when it comes to renting, paying 47% less than the average mortgage payment  in the city. The proportion of locations where it is now cheaper to rent a home than buy one has increased by 14% since October 2016, when it was more cost-effective to buy in 60% of British cities. Read more on the Zoopla website.

One in Three to Face Renting In Retirement By 2040

Millions of future pensioners are destined to spend their retirement in rental accommodation as home ownership plummets, estimates show. Up to a third of 60-year-olds will be renting by 2040, with many never having been able to own their own home, it is claimed. Academics describe renting in retirement as a ‘time bomb’ which will stretch the finances of the elderly while costing taxpayers billions in housing benefit and social care. Professor Steve Wilcox, of the University of York’s centre for housing policy, estimated that only two-thirds of 60 year olds will own their own home within 35 years. Charities warned this could leave them vulnerable to poverty, poor living conditions and eviction. Read more on the Daily Mail website.

Home Ownership Down and Renting Up For First Time in a Century

The decade 2001 to 2011 saw substantial changes in longstanding trends in home ownership and renting. In 2011, more than half (64%, 15.0 million) of the 23.4 million households in England and Wales were owner occupied, however this was a decline from 69% in 2001, which was the first fall in a century. As a consequence, there has been an increase in the proportion of rented households (31% to 36%), particularly within the private sector; private rentals rose from 12% to 18% of the housing market, whilst social rented households remained stable, falling slightly from 19% to 18%. Read more on the ONS website.

Help to Buy 2 Makes It Cheaper To Buy Than To Rent

Paying back a Help to Buy mortgage is cheaper than renting, saving as much as £180 a year, according to Mortgage Advice Bureau (MAB). The average price of a property bought under the mortgage guarantee version of Help to Buy was £153,447 in March, the firm said. MAB claims that based on a 95% loan on the average Help to Buy 2 property price, the typical monthly mortgage repayment for a borrower in their first year would be £753 (or £9,036 annually). In comparison, the average rent across England and Wales now stands at £768 per month. This means that Help to Buy 2 applicants could save £180 annually by paying for a Help to Buy 2 mortgage instead of renting – as well as paying off debt on their own home rather than for a rented property. Read more on the Housing Excellence website.

Buying Is Cheaper Than Renting - For Now

First-time buyers now save £1,300 a year by taking out a mortgage rather than renting, according to Britain's biggest lender, the Halifax. Based on a three-bedroom house, the average first-time buyer pays £677 a month. The average rent paid on the same-sized property is £787, giving owners a monthly saving of £110. But experts warn historically low mortgage rates would not have to rise by much for the reverse to be true. The report says, at present, buying is cheaper than renting in all regions, except the East Midlands and East Anglia. Read more on the BBC website.

Renting To Be 'Way of Life' For Young UK Families

Millions of young families are entering an era of insecurity in which renting becomes the norm, according to a report that warns of steep increases in the number of parents unable to buy their own homes.  The Cambridge University study says that if the British economy remains stagnant, just over one in four people – 27% – will be in "mortgaged home ownership" by 2025, compared with 43% in 1993-94 and 35% now.  Most alarmingly, it finds that it is no longer just young, single people who are locked out of the property market and forced into an under-regulated rental sector due to rising house prices, falling real wages and banks that are unwilling to lend.  The same difficulties are now besetting families with children, many of whom are paying half or more of their income in rent and, as a result, have little or nothing left at the end of the month to save for a deposit.  Download a copy of the report from the Resolution Foundation website.