If you are a first-time house buyer and looking for a rental home in London, then, you may need to reconsider your decision. For, owning a home in London works out to be cheaper than renting one!
Research data revealed by Santander shows that first-time buyers can save money by buying a home in London instead of spending the same on a rental property. Consider this – the average monthly rent in London is £1,569 while the average monthly first-time buyer mortgage repayment is £1,280. You can save £289 a month and £3,468 a year if you decide to buy a new home.
In London, the average first-time buyer home is priced £420,500 while the average first-time buyer deposit is £134,660. It is clear that the first-time buyers would have lower monthly outgoings if they bought a property rather than renting one.
Historically, renting a property in London and the South East has appeared cheaper as the residential real estate prices have consistently been high. However, since 2010, when the economy saw a re-set, the UK has seen inflation fall and with it, mortgage rates have reduced significantly. At the same time, London rents have steadily crept up.
Though buying a property is a major financial investment with upfront costs to consider, in the long-term, the financial benefits are higher when compared to renting a home.
Prospective first-time buyers in London are set to make the biggest monthly savings by making the switch from renting to property ownership, as average rents exceed mortgage payments by over £289 a month or £3,468 a year