It is cheaper to service a mortgage than to rent in 42 of Britain’s top 50 towns and renting is now 16% more expensive on average than owning across Britain, the survey from property website Zoopla also shows.
And it found that renters in London pay £6,687 more on average per year than home owners and overall renting in Britain is 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 three 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 two 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.
‘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,’ said Nicholas Leeming of Zoopla.
