Study reveals rental costs before buying a first home
The average adult in Britain will pay out more than £63,000 in rent before they get onto the property ladder, a new study has found.
Researchers found that people who have bought their first home within the last five years had typically paid £625 every month in rent to their landlords.
And on average, it takes renters almost eight and a half years before they finally save up enough to buy their own home, spending a total of £63,225 in rent, according to the study from home builder Keepmoat Homes.
This means they’ll have already spent the equivalent of more than a quarter of the average £228,903 property in the UK, it points out.
‘For many people, renting is an important first step towards home independence. It offers benefits like flexibility, allowing you to test different areas and types of home, before you commit to buying somewhere,’ said Tim Beale, the firm’s chief executive officer.
‘However, this research highlights the considerable cost of renting and therefore it isn’t surprising to see that for over half of people asked, say they feel as if the dream of home ownership will never be possible,’ he explained.
‘In reality home ownership can cost less than your rent. For example with our average selling price of £156,000, the standard monthly mortgage repayments would make you approximately £100 a month better off than paying the typical £625 rent,’ he added.
The study also found that of those who had bought their first home in the last five years, or who are still renting, some three quarters believe it is ‘impossible’ to save for a home while renting.
Of those who have bought a home, they spent almost five years saving before putting down an average deposit of £24,033 on their property, more than 80% of the average adult’s salary.
However, four in 10 were able to lean on their parents for financial support when it came to their deposit, while a fifth relied on an inheritance and a quarter even ended up moving back in with their parents to save on rent while 24% considered it but were able to avoid it.
For those respondents still renting, they think it will be at least another four years before they are in a position to think about buying their own home. Researchers also found 18% of renters have taken on two jobs in a bid to save for a deposit while paying out monthly to a landlord.
One in four have forsaken holidays, and a third have cut back on luxuries like magazines, flowers in the home and TV and movie costs while 30% said that they started taking a packed lunch to work and 18% tried to do all of their shopping in the reduced section of the supermarket rather than paying full price.
Unsurprisingly, three quarters of those polled, via OnePoll, believe something needs to be done when it comes to the cost of renting to help those trying to save for their own home.