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Homebuyers Pay Less Than Renters In A Third Of Uk Towns And Cities

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Buying a home is cheaper than renting the same property in a third of Britain’s towns and cities – all of them outside the south of England – according to new figures.

Property website Zoopla said servicing a 90% mortgage on a typical two-bedroom home costs an average £724 a month across Britain, while renting comes in at £666. Around the country, however, there are big differences in the relative cost of being a homeowner and a tenant – paying off a mortgage works out cheaper in 36% of cities.

In Glasgow, Zoopla said, buyers who had raised a 10% deposit would repay an average of £447 a month to their lender, far below average rents of £596. Buyers in Dundee stood to pay £112 less each month, while in Birmingham the premium paid by tenants was £97.

In contrast, the website found that in many parts of the south-east homebuyers would pay much more than tenants for the same sized property. In London, the average asking price for a two-bedroom home on the site was £665,000, which resulted in a monthly mortgage payment of £3,302 – 50% higher than the average monthly rent of £2,218; in Reading, Cambridge and Brighton the premium for buyers were all at least 25%. [more at link]

http://www.theguardian.com/money/2015/oct/09/homebuyers-pay-less-than-renters-in-a-third-of-uk-towns-and-cities?CMP=Share_AndroidApp_Facebook

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Yeah a 90% mortgage

So there's opportunity cost on the 10% capital, and maintenance

And interest rate risk

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Yeah a 90% mortgage

So there's opportunity cost on the 10% capital, and maintenance

And interest rate risk

don't forget, fees, buying and selling, maintenance, freedom to move, risk, historic low interest rates. government hand outs, money printing.

I'd say renting now betters everywhere.

was a very small window there buying made a little sense.

that is long gone.

the market is dysfunctional.

I guess if the architect of this lunacy didn't see the collapse coming in 2007 the posh ##### in charge now probably are just as blind.

caveat emptor.

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I think the main thing this article highlights is that it is different across the country. So what one person says about their area isn't true in others. Also I would say that with in an area it depends on the house. a #200,000 house maybe better to buy than rent in one area but a #400,000 house would be better to rent than buy.

I did some very silly calculations.

If you bought 5 houses in Sheffield for #70,000 each and rented them out. So total outlay 350,000. You could rent a 2 million house in Kensington from the income received.

I did say silly calculations so I am not going to defend that statement.

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Its probably worth the piece of mind to rent from a bank, rather than some fly by night 'mom and pop' rentier

Eh?

At these bubble house prices?

And whilst regulations and red-tape is getting ever better to protect renter side?

Ok RP... just don't claim victimhood into the hpc for your buyers.

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It's only "cheaper" to buy in areas where capital appreciation is most unlikely. In other words, buyers need to be offered a premium to take on the risk that they're going to lose their deposit through a fall in house prices.

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