The cost of paying a monthly mortgage is cheaper than renting in around 60% of major cities across the UK. That was the verdict of Zoopla, the property website, when it looked at average monthly rents compared to mortgages on identical properties in the top 50 cities in the UK. Top of the list was Glasgow, where a two-bedroom home would cost an average of £596 to rent, and just £450 for a mortgage payment. This represented a difference of 28%. Second on the list was Birmingham, where the average rental price for a two-bedroom home was £826 compared to £650 for a mortgage on that property. Other major cities are also cheaper for buying than for renting The top ten was continued with Bradford, Coventry and Nottingham in the top five. Paying a mortgage was 23%, 21% and 19% cheaper than renting in these three areas respectively. The top ten was rounded out by Dundee, Barnsley, Middlesbrough, Leeds and Peterborough. The latter proved to be 11% cheaper for mortgage holders than those renting identical properties. A different picture down south The more astute may have noticed the geographical positions of these cities. The stats proved that renting in the northern reaches of the UK was likely a lot more expensive than it would be to pay a mortgage in those same areas. However, the same could not be said the further south you went. For example, buying a property in London could be a lot more expensive than renting. The average renter is usually around £1,118 better off each month than if they were paying a mortgage. That amount is virtually halved in Cambridge, which still saw a significant difference of £549 between the two, with renting proving to be the preferable choice. A significant difference in six months The last time this data was examined was April this year. Just under half of the top 50 cities had cheaper rental prices than mortgage payments at that point. Now this has dropped to about 40%, per the new figures. This does illustrate how difficult it can be to escape the rental trap. Those who are saving to buy their first property can end up stuck in the trap, unable to save money towards a deposit because of the high rents they are paying. Clearly, this is more acute in some areas than others. Just as Glasgow has a difference of 28% between rental and mortgage payments, giving the owner the advantage, London has a difference of 44% between the two, with the renter getting the advantage. The figures were all based on a 90% LTV mortgage payment, using the median monthly rental prices for each area and the median asking price for properties. It remains to be seen whether the trend continues in the same direction over the next six months. People in different parts of the country will either be celebrating or worrying about these figures, depending which side of the fence theyre on.
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