Landlord News

Buying now Cheaper than Renting

It has been revealed that there has been a shift in the UK property market over the last year. It seems individuals who purchase their own property are now in a stronger financial position than those that decide to rent. This is a reversal to the trend that was seen throughout 2011.

Halifax carried out research to uncover such findings. They took into account average buying costs including mortgage payments, income lost by funding a deposit and ongoing expenses for the maintenance and insurance. This was all then compared to the cost of renting. Figures revealed that it is now 16% cheaper, on average, to buy a property.
 
Housing Economist at Halifax, Martin Ellis, has suggested that such a transition is as a result of record-low interest rates that have decreased the cost of mortgage borrowing significantly, along with stamp duty for first time buyers.
 
Mr Ellis has been quoted saying: “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.”

Wendy Evans Scott, President of the National Association of Estate Agents, urged first time buyers to take advantage of stamp duty holiday. This is set to end on March 24th 2012. After the deadline it has been suggested that the government will have to monitor the situation carefully in order to evaluate the impact.