Renting a place to live is now cheaper than owning a first home in nearly all UK regions, research from Halifax has revealed.
The Halifax Owning vs Renting Review found the monthly cost of owning a first home compared to the equivalent rental cost was higher in nine out of the 12 UK regions or nations in 2023.
Renters are making the biggest savings compared to first-time buyers in the East of England, where they are an average of £2,325 better off each year.
Renting in the South East, East Midlands, and Yorkshire & the Humber also saw significant savings of £1,859, £1,741, and £1,741 respectively.
The South West, London, and Scotland were the only regions or nations in which owning a first home is cheaper than renting, with the largest annual savings being in the South West where owners were £1,663 better off.
Halifax mortgages director, Kim Kinnaird, said: “We know home ownership can offer long term financial and living stability and that’s why we believe it’s an important step to take.
“Our customers want to create a secure future, so it’s a big priority for us to help people get there.
“However, elevated borrowing costs, alongside a lack of available homes to buy, is pushing ownership further out of reach for would-be first-time buyers in many parts of the country.”
Halifax also reported the average monthly cost to first-time buyers of owning a home across the UK is now £1,231, £27 lower than renting an equivalent property, the smallest gap between home ownership and renting since 2019.
These findings mean that owners save 2 per cent more when compared with renters.
The analysis, based on the housing costs associated with a mortgage on a three-bed home compared to the average monthly rent of the same property type, also found that monthly rental costs in 2023 grew by 24 per cent to £1,258.
Meanwhile, home-owning costs grew by 27 per cent to £1,231 over the same time period.
tom.dunstan@ft.com
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