Tuesday, 09 August 2022

Monthly cost of buying still lower than renting

THE choice between buying and renting a home can sometimes be a tough decision financially, writes Lucy Boon.

So to help you, estate agency Romans has compared the average monthly costs.

Homeowners are paying just 30.2 per cent of their income into their monthly mortgage repayments, whereas renters are paying 41.9 per cent.

These figures clearly demonstrate how much more affordable buying a home is — and although the percentage of income needed to rent and buy has increased in the last year, the monthly mortgage repayments are still much cheaper than renting.

Other research by the Resolution Foundation shows that Generation Millennial (born between 1977 and 1995) will pay over £44,000 more on renting by the time they reach their 30th birthday compared with their parents.

Antony Gibson, Sales Director at Romans, said: “Whether you can afford to buy a property or not is based on two things — the size of your deposit, especially if you’re a first-time buyer, and your salary, for your monthly mortgage repayments.

“So while it’s true that property prices have gone up, so have salaries, and interest rates have never been lower.

“Nowadays renting is often the only option for first-time buyers because of the rising house prices and large amount of money needed for an initial deposit.

“However, it’s clear from looking at these figures that if buying does become an option it really is much more affordable than renting on a monthly basis — plus your home becomes your investment rather than your landlord’s.”

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