It is now over £800 a year cheaper to purchase a house than to rent, recent research by Halifax has found.
The survey, conducted by the UK’s largest mortgage lender, revealed that the average costs involved in purchasing a property now stand at £672 per month – 10% less than the equivalent monthly rent of £745 for a similar, three-bed semi.
With the average house price falling by 13% in the five-year period between June 2008 and June 2013, rental figures have increased by a similar figure, meaning homebuyers are now in pole position financially.
That now means that in every area of the UK except two – Yorkshire & the Humber; and Wales – it is now significantly cheaper to own.
“A combination of lower mortgage rates and declining house prices has substantially reduced the cost of buying over the past six years. Nevertheless, the number of homebuyers in the 12 months to June 2013 was nearly half of that in 2008, which will have been constrained by worries over job security” said Martin Ellis, Housing Economist at Halifax.
Tumbling interest rates combined with a huge increase in the demand for rental properties have turned the UK housing market on its head, and there has never been a better time to look at purchasing property.
“This news comes at a good time for the UK economy, with signs that the worst of the recession may be behind us. With that in mind, it’s a perfect time to look at getting on the property ladder for current tenants” added Simon Butler, Senior Mortgage and Protection Consultant at niche-broker Contractor Mortgages Made Easy.
Lack of permanent employment should not necessarily be considered a barrier to becoming homeowners, however, as Simon explains.
“Despite the positive news, there still seems to be a commonly held misconception that you’ll struggle to obtain a mortgage as a contractor. Whilst it’s fair to say that it is not quite as straightforward as for permanent employees, lenders are now waking up to the earning potential of this particular workforce.”
“It’s encouraging to see more and more companies starting to realise that contractors represent a safe bet. Indeed, even schemes like the government-backed Home Buy scheme are open to contractors, and this is likely to be in huge demand when it’s opened up to the wider market next year.”
Article By: Mark McBurney, Senior Mortgage and Protection Consultant at Contractor Mortgages Made Easy
Media Contact: Raman Kaur, Public Relations Manager
Tel: 01489 555 080