Homeowners are as much as £3,700 a year better off than people who are stuck renting – The Sun

HOMEOWNERS save up to £3,727 a year in housing costs compared to those stuck renting.

New research shows that it's more expensive to rent than buy in every region of the UK, where tenants pay up to £311 more a month than first-time buyers on their mortgage.

On average across the UK, tenants are handing over £747 of their hard-earned cash every month, while a first-time buyer is repaying £728, according to Halifax.

Perhaps not surprisingly, the worst region in the UK is London where renters pay £1,689 a month to their landlord on average, compared to £1,378 for those who've bought their own home.

The capital is followed by the South East, where renters pay £206 more on average each month, working out as a whopping £2,475 per year.

The research looked at the housing costs including a mortgage on a three-bed home in December 2019, compared to the average monthly rent of the same property type across the UK.

The figures have changed since 2009, when buying was more expensive than renting as tenants saved an average £209 per year or £17 per month, said Halifax.

Over the past decade, costs for renters have rocketed by an average of £186 (33 per cent) compared to an increase of £150 (26 per cent) for homeowners.

Russell Galley, managing director at Halifax, said: "The overall gap between home buying and renting is at its smallest margin for 10 years

"But this masks some significant regional variations where homeowners are making some considerable savings on monthly costs.

"While Londoners stand to save the most from home ownership compared to renting, buyers in the South East and South West of England and north of the border in Scotland are also reaping the benefits.

"Buyers in two thirds of UK regions are saving upwards of £1,000 a year from living in a home they own, with the smallest saving for homeowners in Yorkshire and Humberside at £227."

What help is out there for first-time buyers?

GETTING on the property ladder can feel like a daunting task but there are schemes out there to help first-time buyers have their own home.

Help to Buy Isa – It's a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move. These accounts have now closed to new applicants but those who already hold one have until November 2029 to use it.

Help to Buy equity loan – The Government will lend you up to 20 per cent of the home's value – or 40 per cent in London – after you've put down a five per cent deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.

Lifetime Isa – This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25 per cent on top.

Shared ownership – Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25 to 75 per cent of the property but you're restricted to specific ones.

"First dibs" in London – London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.

Starter Home Initiative – A Government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the Starter Homes website.

Landlords and letting agents have been accused of pushing deposit-free renting on tenants but charging them non-refundable fees instead.

Nearly half of tenants also rely on credit or borrow money to pay for deposits.

While, first-time buyers fork out £63,000 in rent payments before they get onto the property ladder.

Source: Read Full Article