We all know that Britain is suffering a housing crisis. There are a limited number of homes available, there isn’t enough supply to keep up with the demand and prices are exorbitant.
However new figures have revealed that it’s now actually cheaper to buy a property than it is to rent one.
Seems hard to believe, but research by Santander suggests that the average monthly mortgage repayment in the UK is now £805, compared to the cost of renting which is £995 a month.
That’s a saving of £2,300 per year per household when buying a property.
It’s obviously a public relations story that works well in the mortgage lender’s favour, but statistics don’t lie, do they?
The research is based on the average first-time borrower’s deposit of 21%, meaning they have a mortgage of 79% of the property’s price. But for many it’s securing the deposit in the first place that poses the biggest challenge.
The Government’s Help to Buy ISA, introduced late last year, will go some way towards helping to deal with the issue, boosting savings of individuals by 25% (up to a maximum of £3,000).
It’s a move that’s welcomed by housebuilders, such as our client Story Homes, and first-time-buyers throughout the country.
And why wouldn’t it? If people can invest money into their own home, rather than paying somebody to live in theirs, it’s a win-win.
Only time will tell how the scheme will affect the housing crisis but, with thousands of UK residents already signing up, the early signs are definitely positive.