Mortgage lenders Halifax have produced the Buying vs Renting Review to compare the relative cost of renting vs owning a home in the UK at the moment. The results will be good news for homeowners, because Halifax found that owning a home in the UK costs almost a fifth less than renting.
The research specifically compares the cost of buying and renting a three bedroom house. In June this year, the average monthly cost of owning a property like this was £600, compared with an average monthly rent for an equivalent property at £732. That means it’s 18% cheaper to own a home than to live in a rented property.
The difference in cost grew between last year and this year – there was only an 11% difference between renting and owning a home back then. In fact, Halifax research suggests that homebuyers have seen costs fall 43% in four years. In 2008 the average monthly home buying costs were £1,048 compared with £724 for rental accommodation.
There are advantages and disadvantages to owning a home or renting. Homeowners are better off financially than renters at the moment and can benefit from any rises in the value of their home, but renters have the flexibility to move much more easily, and they are not responsible for the maintenance or repair of the building. On the other hand, some renters may be prohibited from buying at the moment as the average deposit required has increased since 2008.