Hamptons’ research also shows that renting is still more cost-effective than buying property for most households in Great Britain. High mortgage rates have pressured buyers with small deposits out of the market, causing them to rent longer term.
Hamptons found that, on average, those who have saved a 5% deposit will pay £300 more a month on mortgage repayments than those who continue to rent.
However, there is a stark difference when breaking down the figures at a regional level. In South England, affordability is most stretched, and London, in particular, is a salient example. The average London tenant will be paying an extra £775 per month in mortgage repayments compared to if they stay in the rental market. According to Hamptons, a mortgage rate of 3.6% would equalise the cost of renting and buying every month in the capital.
However, in North England and Scotland, the difference is less marked, at under £100 more per month, when getting a mortgage with a small deposit compared to renting.
Find out more about the UK property market with our latest buy-to-let guides, covering topics such as available investment property in Salford and available investment property in Wembley.
The latest UK interest rates chart is available to read!
